Ten considerations for DC participants preparing for retirement
While DC plans are both popular and predominant, they have not yet proven to be successful as measured by the DB yardstick of providing employees with a lifetime of sustainable income. Funding retirement for the working population is a global challenge, and a lot of research has delved deeply into the projected retirement savings gap in the United States. Yet little has focused on the gap that matters most to individuals: the gap between the retirement income they want and what they are on track to achieve. Until now.
This article looks at ten considerations within three general areas:
1. How does a low interest rate environment adversely impact a participant’s retirement income?
2. What’s the long-term impact on projected retirement income when funding sources are interrupted as we saw during 2020?
3. How can we build more resilient plan and participant portfolios?