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Are Your Retirement Plans Woefully Short?


Are Your Retirement Plans Woefully Short?

Baby boomer retirement doesn’t look like that of previous generations.

However, nor are boomer retirement trends meeting projections. It figures we’d be a tough group to pin down!

What’s consistent with prior generations – so far – is baby boomers’ intention to retire later than they actually do. Workers say they intend to retire at 65. However, consistently since 1991, the actual median retirement age is 62; 46% retired earlier than planned.

Why the disparity from stated intentions to reality?

  • Health issues/disability (55%)
  • Company changes – downsizing/closure (24%)
  • Needing to care for spouse or other family member (17%)

Retiring earlier than planned often leads to less confidence they can afford retirement.

Those approaching “retirement age” who don’t intend to retire have a wide variety of plans, from working as they are at their current company, to moving to part-time work at their current company or doing something completely different, to striking out on their own as entrepreneurs.

Common Pre-Retirement Concerns

The current economy is highly volatile, and individuals approaching retirement have weathered – some much better than others – the multi-year financial crisis. Therefore, it’s not surprising there’s more than a bit of uncertainty when making important retirement decisions.

Common employment concerns:

1. Will they be able to find jobs that are a good fit, pay well, and value their contributions?

a. Per AARP (2), 74% seek work for the additional income

2.  How long will it take them to find a job?

a. Per AARP (4) on average it takes seven months to find a new job. However, the timeframe varies considerably; 60% within three months, 27% three months to one year; 13% more than a year.

3.  Will they face age discrimination when searching for work?

a. Per AARP, 64% of workers have seen or personally experienced age discrimination in the workplace.

4.  How easily will they be able to work for/with employees who are considerably younger?

Common Financial Concerns

  1. Will they be able to work as long as they need to financially?
  2. Are they prepared financially to meet their needs in retirement?
  3. How will their health impact both what they do and their ability to pay for healthcare and other expenses in retirement?

Employers Efforts to Help Employees Prepare for Retirement3

Historically employers have taken little responsibility for helping employees prepare for retirement. Additionally, many only think of retirement as completely leaving the workforce. It’s critical for both employers, who need the institutional knowledge, mentoring, knowledge transfer, skills and strong work ethic of baby boomers, and employees who may not want to retire, or aren’t financially in a position to retire, to consider a variety of options.

Leaders have a unique opportunity to address a number of transitional needs – in this age of rapid transformation – through creative use of older employees’ experience and knowledge.

More employers are now making retirement planning tools available. “It’s the right thing to do” was the reason provided by 85% of employers. And, 80% believe providing tools will increase employee engagement. Examples:

Tools, services and communications to improve individuals’ financial well-being, with many employers allowing retirees use of these programs beyond retirement.

Employers are also expressing concern about low dollar figures in ‘near retirees’ defined contribution accounts. About 75% of employers are working with employees to minimize “leakage” (primarily loans) from these plans.

Looking Forward

The tremendous uncertainties surrounding retirement and the wide variance in the degree individuals have (and are) prepared/preparing themselves financially for retirement, demonstrates the tremendous need for assistance.

Current employees need help to fully understand what steps to take financially and in other areas to confirm they are on track, or create detailed, easily monitored plans to help them attain the best retirement scenario they can.

Employers must play a significant role:

  • Options for a phased transition
  • Education in many forms – initial planning, monitoring, tracking progress
  • Easily understood and easy-to-use tools for employees and spouses
  • Ongoing communication and tips
  • Expertise from retirement planning experts – online, in-person

Action Items:

  1. Review your employees’ internal retirement savings accounts. If you note a large number of loans against these accounts, create both written and in-person methods to communicate to all employees the importance of these savings. Bring in external expertise to provide ‘real world’ examples using a variety of scenarios that would apply to a workforce similar to yours.
  2. Evaluate whether your organization is currently taking full advantage of opportunities to gain from experienced, knowledgeable workers – potentially through cross-training, mentoring or other roles. Facilitate phased retirement whenever feasible, and ensure knowledge transfer is built into the transition process.
  3. Assess the current ways and frequency of communications with all employees, with an emphasis on ensuring there is clear – yet tailored by age and other factors relative to retirement – information and easily accessed and usable tools available for employees to create their own scenarios and retirement plans. If what you’re currently offering isn’t sufficient determine what additional is needed and begin adding where needed.
  4. Hold well-promoted on-site – perhaps “lunch & learn” sessions at convenient times for employees to come learn from different specialists, with the opportunity to ask questions as well as leave with information they can use.


  1. Helman, Ruth (Greenwald & Associates); Copeland, Craig, Ph.D., VanDerhei, Jack, Ph.D., (Employee Benefit Research Institute),The 2016 Retirement Confidence Survey: Worker Confidence Stable, Retiree Confidence Continues to Increase  Employee Benefit Research Institute, March 2016, (
  2. Ahn, Jeanie, Switching Careers Later in Life – What You Need to Know, Yahoo Finance, January 15, 2016
  3. 2016 Hot Topics in Retirement and Financial Well-Being Aon Hewitt
  4. Keenan, Teresa, Experiences with Work, AARP, January 2016
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