Retirement Readiness






The Indexed Annuity Leadership Council recently published a report that included a scoring mechanism for how “retirement ready” Americans are based on job status. “White-collar workers” rated just below 50 percent in terms of retirement readiness, while “blue- and gray-collar workers” were somewhat lower, at 44.7 percent.1

Another recent report on retirement readiness was published by Fidelity. According to this one, the typical saver received a score of 80 — meaning he is on target to have 80 percent of the income Fidelity estimates will be needed to cover retirement costs. This is a significant rise from 13 years ago when the study was first conducted; at that time, the score was 62. Remarkably, the biggest improvement in scores has been achieved by millennials, who are now at 78 percent readiness, topping the 77 percent score of Generation X. Baby boomers have moved up one notch from last year, to 86 percent readiness.2

Sometimes we get so caught up in our daily work, family obligations and just paying the bills that we forget to look at the big picture, financially speaking. In other words, perhaps you have some investments and automatically contribute to a retirement savings plan, but when was the last time you monitored those assets and calculated how much income they are on track to provide in retirement?

Baseball great and philosopher Yogi Berra once said, “If you don’t know where you are going, you might wind up someplace else.”3 The lesson here is to know what you need so that you take the appropriate financial path to help you get there. If you’d like help conducting a retirement readiness checkup, please give us a call.

Researchers from the Center for Retirement Research (CRR) at Boston College recently sent a
report to the Department of Labor recommending strategies to help Americans better prepare for retirement. Suggestions include:4

Enhance portability, so it’s easier to move retirement accounts from one employer to another.
Make it less tempting for workers to take withdrawals before retirement.
Expand coverage by imposing a mandate on employers to automatically enroll workers in their retirement plans (with the ability to opt out).
Mandate employers to contribute to a retirement plan on behalf of their employees.

The U.S. also has a problem in that more Americans need retirement saving options. Currently, fewer than 50 percent of workers in the private sector have access to an employer-sponsored plan. There is a general consensus that our retirement system is far too reliant on employers and 401(k) plans to save for retirement.5

Interestingly, even private sector investment firms are calling for the government to initiate measures to expand access to retirement plans and boost participation and savings. Wealth manager BlackRock recommends that the government develop a modified SIMPLE individual retirement account (IRA) plan that small businesses can offer workers, featuring low startup and maintenance costs. The investment firm also recommends workers have increased access to lifetime income products — such as annuities — as an option in employer-sponsored 401(k) plans.6

Employers that offer retirement plans are delving further into ways they can help workers address financial concerns, including programs for funding student debt, caregiving responsibilities and long-term care in retirement.7

If we can be of any assistance please give us a call at 801-990-5055.

Our firm assists retirees and pre-retirees in the creation of retirement strategies utilizing investment and insurance products. Advisory services offered through B.O.S.S. Retirement Advisors, a Registered Investment Advisory firm.. Insurance products and services offered through B.O.S.S. Retirement Solutions. Marketing materials provided by Infinity Marketing Services.

To see a list of services please visit us at bossretirement.com/services.

1 Indexed Annuity Leadership Council. 2018. “America’s Workforce: The Reality of Retirement Readiness.” https://fiainsights.org/americasworkforce/. Accessed Aug. 3, 2018.

2 Fidelity. Jan. 31, 2018. “Fidelity Study: America’s Retirement Score Improving, with Millennials Catching Up to Generation X in Terms of Retirement Preparedness.” https://www.fidelity.com/about-fidelity/individual-investing/americas-retirement-score-improving. Accessed Aug. 3, 2018.

3 Goalcast. June 3, 2018. “15 Funny Yogi Berra Quotes that Make Perfect Sense. https://www.goalcast.com/2018/06/03/15-funny-yogi-berra-quotes/. Accessed Aug. 20, 2018.

4 Rebecca Moore. PlanSponsor. June 5, 2018. “CRR Offers Retirement Policy Suggestions to the DOL.” https://www.plansponsor.com/crr-offers-retirement-policy-suggestions-dol/. Accessed Aug. 3, 2018.

5 Politico. “How to solve the retirement crisis.” https://www.politico.com/agenda/story/2018/06/07/future-of-prosperity-retirement-report-000663. Accessed Aug. 3, 2018.

6 Lee Barney. PlanSponsor. July 24, 2018. “BlackRock Lays Out Plans to Boost Retirement Readiness.” https://www.plansponsor.com/blackrock-lays-plans-boost-retirement-readiness/. Accessed Aug. 3, 2018.

7 Allessandra Malito. Marketwatch.com. Aug. 2, 2018. “Worried you’re going to retire broke? Help could be closer than you think.” https://www.marketwatch.com/story/worried-youre-going-to-retire-broke-help-could-be-closer-than-you-think-2018-08-02. Accessed Aug. 3, 2018.

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