Nearly half of all retired Americans today have little or no money saved. The vast majority have far less than what they will need, and are not saving and investing sufficiently to make up for the shortfall. American workers must now grapple with many questions as they consider retirement: Have I saved enough? How much will inflation erode my savings? Could I outlive my money?
401(k) Plans in Living Color: A Study of 401(k) Disparities Across Racial and Ethnic Groups is both groundbreaking and important. This study — the largest, most comprehensive examination of the
The findings in this study are based on year-end 2007 information collected from nearly 3 million eligible employees working for 57 of the largest U.S. companies across a variety of industries and sectors. The data, collected by Hewitt Associates, includes race, ethnicity, gender, salary, age, job tenure,
The results of the study reveal that — even after controlling for factors such as age, salary, and job tenure — quantifiable differences are clear across race and ethnicity in how successfully
The project collaborators strongly believe swift action needs to be taken to address the disparities and potential lack of retirement preparedness among many people of color. Our call to action is broad-based — covering employers, government, and individuals — and can ultimately benefit all plan participants, regardless of race, ethnicity, or gender. As part of recognizing the problem and finding solutions, the study outlines five recommendations:
2. Provide the necessary communication, education, and resources to help individuals make wise choices.
3. Encourage employers to voluntarily collect and report their
4. Modify loan requirements in
5. Provide financial education as a mandated component of both public and private school curricula at all levels, from kindergarten through secondary school.
Saving for retirement in a
Podcast Interview with Mellody Hobson of Ariel Investments
Hewitt's One-to-One podcast series features an interview with Mellody Hobson, nationally-recognized voice on financial literacy and investor education. Hobson shares her perspectives on retirement preparedness and the new Ariel/Hewitt research on