The survey found that 56% of respondents worry they will be unable to maintain their current level of contributions to their employer’s 401(k) or other defined contribution retirement plan. A total of 34% were “extremely” or “very” worried about sliding back on how much they save, according to a press release.
Nearly one in three survey respondents (32%) said they are likely to postpone making additional contributions to their retirement plan and one in four (24%) said they are likely to postpone retiring altogether. In addition, more than half (53%) said they are concerned that their employer will reduce or eliminate matching contributions on their retirement savings – with 30% “extremely” or “very” worried.
Those numbers could pose problems for employer-sponsored retirement plans as declining participation rates and reduced contributions can have a negative impact on the viability of the plan, according to Tom Foster Jr., The Hartford’s national retirement spokesperson, the press release said. If the gap between what highly compensated and non-highly compensated employees contribute to a company’s retirement plan exceeds IRS guidelines, then many highly compensated employees may be forced to take back a portion of their contributions and pay additional income taxes.
Foster suggested employers encourage employees to contribute to their retirement plan by sponsoring educational meetings, promoting the new Savers Credit, or adopting automatic enrollment.