Employees Value Retirement Accounts

November 18, 2002 (PLANSPONSOR.com) - Small business employees put more weight into the value of retirement plans than expected by their employers, according to a TransAmerica Center for Retirement Studies recent survey.

Small businesses seem unaware of how important retirement programs are to current and future employees.   The recent survey of small business employees shows:

  • 53% would rather have a job that meets their minimum salary requirements and offers excellent retirement benefits than have a job that offered an excellent salary but poor retirement benefits.   Only 29% of employers believed employees would respond this way.
  • 51% ranked an employee funded retirement plan as being very important.   Only 27% of employers believed employees would rank these plans so high.

Additionally, 73% of small business employees said they would rather have their retirement money in a company-matched 401(k) than a company funded pension plan.

The survey also revealed small businesses may need to do a better job of speaking to their employees about retirement plans available to them.   Employee responses show:

  • 76% say they do not know as much as they should about retirement planning
  • 61% have not spoken to their HR department or immediate supervisor about retirement benefits
  • 32% strongly agreed they would like to receive more information or advice from their employer about reaching retirement goals
  • Only 25% feel their employer encouraged input on retirement plans

The survey was conducted by via telephone by Harris Interactive between October 1 st and 17 th .   Results are based on responses from 765 small business employees and 300 small business employers, ranging in size from 10 to 500 employees.