Even with money accumulating in defined contribution (DC) accounts against the day they will stop working, many retirement plan participants are afraid they will have too little to protect them from the steep costs that come with retiring and getting older, according to a new report from Spectrem Group.
“Financial Attitudes and Concerns of Retirement Plan Participants,” the company’s latest plan participant report, examines the personal and financial factors that affect investors in defined contribution plans.
Whether investment decisions and concerns involve the health of a spouse, getting adequate adviser help, or a low plan balance, plan participants are unique investors with specific attitudes and concerns that affect their investment behaviors.
Key findings from the report include:
- Only half of participants believe they will have enough retirement income to live comfortably in retirement;
- The cost of health care is the top financial concern of plan participants, who fear their retirement account balances will be depleted in retirement; and
- Tax increases, the political environment and inflation are the top national concerns of plan participants.
The economy is a major concern for defined contribution plan participants, according to George Walper Jr., president of Spectrem Group. Walper believes more education about how participants can protect their investments in another significant downturn would be a benefit for them. “They’re also very concerned that health care costs will deplete their savings, and keep a close eye on issues that will affect their plan balances,” Walper says.
More information about the report, including how to purchase it, is at Spectrem’s website.