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Retirement risk: Employees and employers don't always agree

Posted: 12:38 PM, Jul 30, 2019
Updated: 2019-07-30 15:38:27-04

One area in which employers and employees can agree is that “debt” is the biggest obstacle to saving for retirement, that’s according to a national survey conducted by the leading investment management firm, American Century Investments. Then it comes as no surprise that 80% of employees count “not saving for retirement” as one of their personal regrets.

The study looked at how each group views risk, help with preparing for retirement and recognizing barriers to saving. And, they found stark differences between the employees and employers:

  • DON’T LEAVE ME ALONE: Employers think more of their employees want to be left alone in saving for retirement than is actually true. In fact, employers thought the number of employees who want to be “left alone” is double the amount of employees who actually feel that way.
  • WHAT WORRIES YOU?: Employers are most worried about market risk (swings in the market and variability of returns) with investments while employees are more worried about longevity risk (or running out of money). The study found that 75% of employees are more worried about affording retirement than how they will spend their time.

The survey also found a difference in how age groups expect their standard of living in retirement to be - with the 84% of older generation, between 55 and 65, thinking their finances will be about the same or a little worse and only 68% of those between 22 and 54 thinking their finances will be about the same or a little worse.

Diane Gallagher is Vice President for American Century Investments. She is responsible for developing content and value-add programs for clients and is also a spokesperson on retirement investing. Diane originally joined American Century Investments in 1995 and developed communication programs for clients of J.P. Morgan/American Century Retirement Plan Services. Prior to returning to American Century in 2012, Diane was Vice President, Retirement Insights for J.P. Morgan Asset Management. Previously, she led product marketing for J.P. Morgan Retirement Plan Services and directed the participant communications and education department