The research, which highlights the savings behaviors of current and former 401(k) participants in a challenging economy, also found nearly one in five respondents (19%) currently enrolled in workplace plans report they have no retirement savings at all outside this key retirement benefit.
Of those who do have savings outside of their 401(k), 37% of working respondents are building retirement savings in an IRA. In addition, 33% are in an employer-sponsored pension plan, 28% have savings in bank accounts, and 28% have investments in stocks or bonds. Pre-retirees 55 and older are the most active users of IRAs, with 44% saying they utilize these retirement savings investments.Fidelity’s survey found that nearly one quarter (23%) of working respondents have taken a loan from their retirement plan, with many saying they needed to do so for an unforeseen emergency. But when asked about the decision, 29% of these respondents indicated they would not do so again.
Match a Powerful Incentive
Fidelity surveyed 1,000 current and retired workplace plan participants on their attitudes and behaviors toward retirement savings and found 92% of current workplace participants indicated they chose to participate in their 401(k) because it is important or very important not to lose out on company match dollars, and 90% said the plans are a good tax-deferred way to save.
The survey found more than half (53%) of working respondents increased their contribution rate in the last five years, despite historic market volatility and economic uncertainty. However, economic conditions still present a challenge for many, with more than half (54%) of working respondents reporting they would contribute more to their 401(k)s if they could.
When asked why they increased their contributions, 23% of working respondents said they wanted to take full advantage of employer matching dollars, and 38% said they had received a raise or had extra money available.Only 23% of working respondents reported ever decreasing their workplace plan contribution percentage. For those who decreased contributions, 46% reported needing extra money, and 9% said it was due to the elimination of a company match. Forty percent of these respondents said they already do – or possibly will – regret the decision to decrease their retirement savings contribution.