Retirement funds largely left intact

Between stimulus payments, enhanced unemployment benefits, and a robust (though not entirely even) economic recovery in many sectors, we see some positive news. Fewer Americans drew on retirement funds during the pandemic than we had feared. In 2020, Fidelity Investments, the nation’s largest 401(k) provider, said 1.6 million people, or 6.3% of eligible participants in plans it administers, took some money out. “Given how many people have been impacted by Covid, 6% can be viewed as good news,” said Rob Austin, director of research at Alight. With unemployment rates high last spring, he said, some in the industry initially expected as many as half of 401(k) participants could raid their accounts. Perhaps one contributing factor however has been that the unemployment challenges have been disproportionately faced by lower income workers who may not participate in a retirement savings plan. Either way, let us be optimistic that the job market will see further improvement in 2021. It has recovered some, but remains on weak footing. #retirement #recovery #jobs

Between stimulus payments, enhanced unemployment benefits, and a robust (though not entirely even) economic recovery in many sectors, we see some positive news. Fewer Americans drew on retirement funds during the pandemic than we had feared. In 2020, Fidelity Investments, the nation’s largest 401(k) provider, said 1.6 million people, or 6.3% of eligible participants in plans it administers, took some money out. “Given how many people have been impacted by Covid, 6% can be viewed as good news,” said Rob Austin, director of research at Alight. With unemployment rates high last spring, he said, some in the industry initially expected as many as half of 401(k) participants could raid their accounts. Perhaps one contributing factor however has been that the unemployment challenges have been disproportionately faced by lower income workers who may not participate in a retirement savings plan. Either way, let us be optimistic that the job market will see further improvement in 2021. It has recovered some, but remains on weak footing. #retirement #recovery #jobs

Between stimulus payments, enhanced unemployment benefits, and a robust (though not entirely even) economic recovery in many sectors, we see some positive news. Fewer Americans drew on retirement funds during the pandemic than we had feared. In 2020, Fidelity Investments, the nation’s largest 401(k) provider, said 1.6 million people, or 6.3% of eligible participants in plans it administers, took some money out. “Given how many people have been impacted by Covid, 6% can be viewed as good news,” said Rob Austin, director of research at Alight. With unemployment rates high last spring, he said, some in the industry initially expected as many as half of 401(k) participants could raid their accounts. Perhaps one contributing factor however has been that the unemployment challenges have been disproportionately faced by lower income workers who may not participate in a retirement savings plan. Either way, let us be optimistic that the job market will see further improvement in 2021. It has recovered some, but remains on weak footing. #retirement #recovery #jobs

Between stimulus payments, enhanced unemployment benefits, and a robust (though not entirely even) economic recovery in many sectors, we see some positive news. Fewer Americans drew on retirement funds during the pandemic than we had feared. In 2020, Fidelity Investments, the nation’s largest 401(k) provider, said 1.6 million people, or 6.3% of eligible participants in plans it administers, took some money out. “Given how many people have been impacted by Covid, 6% can be viewed as good news,” said Rob Austin, director of research at Alight. With unemployment rates high last spring, he said, some in the industry initially expected as many as half of 401(k) participants could raid their accounts. Perhaps one contributing factor however has been that the unemployment challenges have been disproportionately faced by lower income workers who may not participate in a retirement savings plan. Either way, let us be optimistic that the job market will see further improvement in 2021. It has recovered some, but remains on weak footing. #retirement #recovery #jobs

Some thoughts on the basic conundrum of the 401(k) era: Withdraw too much from retirement in the early years and you run the risk of exhausting your savings prematurely. Being too cautious means you won't live as comfortably as you could.

Wondering how employers who continue to sponsor defined benefit or cash balance pension plans as another piece of the retirement security puzzle will be viewed by employees in terms of their commitment to financial wellness?

When your emergency fund is running out or if it didn't exist in the first place, people are taking from their future to survive today. #emergencyfund #financialeducation #financialliteracy