Boosting Retirement Readiness at Key Career Stages

October 21, 2014 ( - This week marks the annual celebration of National Save for Retirement Week, an initiative promoting the importance of offering and participating in employer-sponsored retirement savings plans.

Throughout the week, the retirement industry provides plan participants with information and tools to help them save for retirement. While many universal tips apply to any organization’s entire participant base, savers at different stages of their careers have specific savings needs and challenges. Taking a targeted view of actions directly related to different career stages can help motivate people to take meaningful actions that help them achieve retirement readiness.   

According to a recent M.O.O.D. of America study conducted by Lincoln Financial Group, most Americans are taking a careful and deliberate approach when it comes to their retirement plans. Among those who feel prepared, 77% believe they have saved enough to cover retirement expenses, and 64% will be debt free during retirement.

All plan participants have a unique savings story. Some may be entering the workforce for the first time. Others may be in between jobs or changing jobs. Many are in the middle of their career, advancing in their roles or near retirement. Plan sponsors have the opportunity to take a closer look at their participant base and provide a retirement plan program that encourages savers to take actions through all career stages. Plan sponsors can enhance engagement by connecting with participants at specific stages and help them navigate their career from start to finish.

Here are five checkpoints to help plan sponsors better understand how participants engage in saving at different points in their career.

First-Time Savers

According to a Lincoln Financial Group participant satisfaction survey, today’s living expenses can make it difficult for 77% of Millennials to plan or put money toward their future. Young savers may think they have all the time in the world to save for retirement. The reality is saving early gives participants the opportunity to make their money work for them with compounding interest. It’s important for young savers to enroll in their employer-sponsored retirement savings plan as soon as it’s available to them. Plan sponsors can provide retirement education about the importance of saving at least up to the company match. Plan sponsors should also consider plan design features including automatic enrollment and qualified deferred investment alternatives options to help make it easy for younger participants to get on track with retirement savings early in their career.  

It can also be tempting for younger workers to spend their entire paycheck, particularly if they have debt and other spending priorities. Encourage participants just entering the workforce to create a budget to help manage and prioritize expenses so they can start making retirement savings a priority too.

Changing Jobs or In Between Jobs

An employee is likely to experience a job change or job loss at some point as they navigate their careers. An encouraging statistic from the participant satisfaction survey shows that nearly 60% of workers feel they would be prepared if something disrupted their income for the next year. This is also a time where savers may be tempted to borrow or take money out of their plan. Plan sponsors should provide participants with complete information about loans, including tax implications and/or penalties savers might incur if they make the decision to take money out of their plan.

While it is important for plan sponsors to encourage plan participation, they should also educate employees about the importance of building emergency savings so they don’t have to dip into their retirement savings.

Participants coming to a new job from a different company should consider an employer’s retirement plan offering as part of their overall compensation package. Plan sponsors should promote their retirement savings program as a way to help recruit and retain top talent and a key benefit aligned with their total rewards philosophy. 

Mid-Career Savers

Expenses incurred during the middle of a participant’s career can often change the trajectory of their retirement savings. Participants at this stage may be saving for a child’s education, buying a new car, making home improvements, making mortgage payments or other expenses. Provide participants with access to a financial professional to help them resist the temptation to decrease contributions or stop saving all together. A financial professional can look at a participant’s entire savings picture and assess the best ways to help them stay on course. The Lincoln Financial Group participant satisfaction survey found that people who have access to guidance from a financial professional, like a retirement consultant, are 35% more confident in their retirement readiness.

Plan sponsors can also look at incorporating custom target-date funds into the plan design as a way to help savers in their mid-career experience less volatility with investments and stay the course for the long-term savings.

Savers Advancing in Their Careers

As people progress in their careers, retirement plan sponsors can help educate them about their options and the importance of saving more as they make more. Encourage participants to consider putting any extras from bonuses, salary increases and other cash inflows toward retirement savings instead of adjusting their living standards. Plan sponsors can also provide resources for participants who have maxed out their contributions. Financial professionals can advise participants about other savings and investment options that are a fit for this career checkpoint.

Savers Near Retirement

It’s valuable for plan sponsors to encourage near retirees to keep up their savings momentum. Nearly 85% of older Boomers who feel prepared for retirement say they have a guaranteed income source they can depend on, according to the participant satisfaction survey. Consider offering an in-plan guarantee investment option as part of your retirement plan program.

Guaranteed Withdrawal Benefits (GWB) guarantee a stream of income while protecting participants in a down market just prior to, or shortly after, they retire. When used with a target-date fund and risk management, the participant retains market exposure to provide growth potential that can be hedged against inflation, reduce the risk to downturns in the market, and offer a steady income stream in retirement. Plan sponsors should be aware of the fees associated with guarantees and that the guarantees are subject to the claims-paying ability of the issuer.


Whether savers are just starting out in their career, changing jobs or approaching retirement, there are actions that can help boost their retirement readiness at all career checkpoints. Plan sponsors are in the unique position to help set up savers for success on their road to retirement. Participants and plan sponsors alike should use National Save for Retirement Week as a reminder to take every available opportunity to help boost participation and savings in our employer-sponsored retirement plans. Each day this week, Lincoln will be unveiling a different “checkpoint” for savers on the road to retirement readiness on its website.   


Chuck Cornelio, President, Retirement Plan Services, Lincoln Financial Group   

Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates.  

NOTE: This feature is to provide general information only, does not constitute legal advice, and cannot be used or substituted for legal or tax advice. Any opinions of the author(s) do not necessarily reflect the stance of Asset International or its affiliates.
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