"Scoring the Progress of Retirement Savers"

“Scoring the Progress of Retirement Savers”

Are You Hearing About Financial Wellness?
August 31, 2020
Good News 401(k)
August 31, 2020

More Good News

Scoring the Progress of Retirement Savers, a recent report by Empower shows that the median projected income replacement among participants in our study was 64%. In other words, Americans are on track to replace 64% of their current income in retirement.

“Plan sponsors can take several steps to help facilitate savings within a plan. The first is automatic enrollment. We find an 11-point difference in median income replacement percentages between participants who enrolled automatically versus those who opted into the plan. The difference may reflect an important benefit of auto-enrollment: Many participants begin saving earlier in their tenure because enrollment begins as soon as they are eligible.

A second feature that correlates with higher median income replacement is auto-escalation. Our survey found that people who participate in a plan with this feature achieve a median retirement income replacement of 107%, a full 27 percentage points higher than participants in plans without it.”

For more information, read Empower’s report on Scoring the Progress of Retirement Savers.

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