The power of automated 401(k) plan features
Data insights challenge common beliefs about automated plan features.1
Read more insights from our thought leaders
Read moreThe power of automated 401(k) plan features​
Data insights challenge common beliefs about automated plan features.1
Read more insights from our thought leaders
Read moreThe power of automated 401(k) plan features​
1. All statistics are from Â鶹×îгöÆ· data as pf December 31, 2024, unless otherwise noted.​ Figures may not sum to 100% due to rounding.
2. Â鶹×îгöƷ® Insights Communities Research, March 2024.
3. Based on analysis conducted by the Â鶹×îгöÆ· Financial Group®, October 2024. The estimate assumes a 40-year span of accumulating savings and the following facts: retirement at age 65; 15% individual rate including employer contributions; Social Security providing 40 percent replacement of income: 4.5% withdrawal of retirement savings; 6 percent annual market returns; 2 percent annual inflation; and 3 percent annual wage growth over 40 years in the workforce. This estimate is based on a goal of replacing about 80 percent of salary. The assumed rate of return for the analysis is hypothetical and does not guarantee any future returns nor represent the return of any particular investment. Contributions do not take into account the impact of taxes on pre-tax distributions. Individual results will vary. Participants should regularly review their savings progress and post-retirement needs as savings depends on many factors, including lifestyle, social security replacement, and retirement age.​
Replacement factor of 80% is based on our industry experience and GAO Retirement Security Report to Congressional requestors. The estimated average total spending for post-retirement households was about 77 percent of the spending levels for pre-retirement households. GAO, 2013 CE Data; 16-242, Retirement Replacement Rates.​
4. Â鶹×îгöƷ® Real Life Retirement Journeys survey, October 2024. 61% of people took a loan, reduced their contribution amount, or stopped saving for retirement entirely.​
5. The assumed rate of return is hypothetical and does not guarantee any future returns nor represent the return of any particular investment option. Estimated savings amounts shown do not reflect the impact of taxes on pre-tax distributions. Individual taxpayer circumstances may vary. Assumptions: An individual starting at age 25 with a 40-year career (i.e., retirement age of 65); starting salary of $50,000 with 3% annual increases; an employer match of 50% up to 6%, annual rate of return of 6%, withdrawal rate in retirement of 4.5%, and Social Security replacement of 28% source: ​
The subject matter in this communication is educational only and provided with the understanding that Â鶹×îгöƷ® is not rendering legal, accounting, investment or tax advice. You should consult with appropriate counsel, financial professionals, and other advisors on all matters pertaining to legal, tax, investment or accounting obligations and requirements.
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