Although most workers accept responsibility for financing their retirement and rely primarily on their 401(k) plans to get them there, many aren't sure they can manage those plans effectively, according to a Schwab Retirement Plan Services nationwide survey of more than 1,000 participants.
401(k) use and trends
- Nearly nine in ten participants (89%) believe they'll be responsible for funding their "golden years" through a 401(k).
- 61% report that the 401(k) is their only or largest source of savings.
- 55% have increased their savings rate in the past two years.
- 70% say their plan is in better shape than ever.
Participant concerns
- 52% find their investment explanations even more confusing than those of their health benefits.
- 57% would like an easier way to determine the best investments.
- 34% feel stress over allocating their plan dollars correctly.
Of the workers surveyed, 61% want personalized investment advice on everything from asset allocation to risk tolerance and retirement income planning. Investment confidence nearly doubled when workers had the help of a financial professional: more than two in three respondents (61%) expressed confidence in making the right choices with professional advice, compared with one in three (32%) who relied only on their own abilities.
"Getting more workers engaged in professional 401(k) advice should be a top priority for employers," says Steve Anderson, head of Schwab Retirement Plan Services. "At Schwab Retirement Plan Services, Inc., participants who used third-party, professional 401(k) advice tended to increase their savings rate, were better diversified, and stayed the course in their investing decisions."
Employers and participants who want more information about plan options can review resources like 401(k) and 403(b) Retirement Plans and Related Insurance for plan-related insurance and administrative considerations.
For questions about plan loans, related insurance, or broader risk-management topics, see Insurance, Risk Maps, Construction Property Insurance, and Retirement Plan Loans.
If you'd like help reviewing plan options, talk to an agent.
Frequently Asked Questions
How can I get professional help with my 401(k)?
You can seek advice from a financial professional through your plan's advisory services or an independent advisor who understands employer-sponsored plans.
Will getting advice guarantee better returns?
Advice doesn't guarantee higher returns, but professional guidance can improve diversification, contribution rates, and long-term decision-making.
What should I ask a financial professional about my plan?
Ask about appropriate asset allocation, fees, target retirement income, and how contributions and employer matches affect your goals.
Are 401(k) investment choices required to be clearly explained?
Plan administrators must provide disclosures, but explanations can still be confusing; a professional can help interpret options and documents.