Before It's Too Late: A Retirement Security Update From Assistant Secretary Phyllis C. Borzi
Hello! I'm Phyllis Borzi, Assistant Secretary for the Employee Benefits Security Administration at the U.S. Department of Labor.
October 21-27 is National Save for Retirement Week! While I believe that every week should be ‘save for retirement week', it's good to have a designated time when busy people can stop and do a quick assessment of where they are in their retirement planning, and to make changes if needed.
The importance of saving for retirement is a bipartisan issue. The Senate Resolution designating 2012's National Save for Retirement Week was introduced by Senator Kent Conrad of North Dakota and cosponsored by Senators Mike Enzi of Wyoming and Ben Cardin of Maryland.
Here are a couple of things to think about this week. First if you work for an employer offering a 401(k) plan, are you signed up for it? In addition to the tax benefits, many employers also offer a matching contribution. If you are already enrolled, how much are you contributing? For individuals younger than 50 years old, the 2012 maximum 401(k) annual contribution limit is $17,000. If you are over 50, you can contribute an additional $5,500 in catch-up contributions. Even if you can't afford to max out to your 401(k), you should at least make sure you are putting in enough to meet your employer's match. Don't leave free money on the table!
Second, take 15 minutes to review those retirement plan fee disclosures that have been sitting in your mail pile! Open the envelope and take a look at how much you are paying in fees for your retirement accounts. If you have multiple accounts, you may want to consolidate them in order to reduce the amount of fees you pay. You may decide to invest in funds that carry lower fees, or to call your plan sponsor and learn more about the fees that are being assessed against your retirement account and the services for which you are eligible.
After you have taken these two simple steps, reach out to five family members and/or friends and encourage them to do a quick review of their retirement plans. Sometimes a nudge from a loved one can make the difference.
So let's make every week Save for Retirement Week!