Federal Reserve Board Survey Shows Lack of Retirement Savings among Federal Employees
The new Federal Reserve Board (FRB) survey and report on the economic well-being of U.S. households in 2014 has some startling data about the lack of retirement savings and planning among survey respondents.
For starters, only 13 percent of respondents who are not currently retired said they have given “a lot” of thought to financial planning for retirement. A full thirty-nine percent of respondents say that they have thought only “a little” or “none at all” about it.
It doesn’t follow that those who aren’t interested in financial planning are the only ones not saving for retirement. On the contrary, the Federal Reserve Board survey shows that 31 percent of non-retired respondents say they have no retirement savings or pension whatsoever.
Forty-two percent of respondents who do not participate in a plan indicate that they do not participate because their employer does not offer a plan, and six percent say that their employer offers a plan but does not match contributions.
Do You Know Your Contributions to Your Retirement Savings Plan?
Among those who are contributing to retirement savings plans, a full 47 percent said they had a defined contribution plan, such as the TSP, 401(k) or 403(b) plan. Only 22 percent of respondents said they participate in a traditional defined benefit pension plan through an employer.
Many respondents also seem to have very little idea about how much they are saving or contributing to their retirement savings plans, and level of the 401(k) match provided by their employer.
When asked what fraction of their paycheck they contribute to their TSP (or similar), 23 percent of respondents who have a retirement account say that they do not know. Additionally, 41 percent of respondents whose employer offers a plan say they do not know the maximum fraction of their salary that their employer will match.
Only 29 percent of respondents said they have an individual retirement account (IRA), and 37 percent indicate that they have savings outside of a formal retirement account.