Making retirement plans is a little like periodic visits to the dentist. A lot of people put it off because of potential for discomfort. Some simply don’t prioritize it. Still, it feels good once it’s taken care of. The trick is to get motivated and follow through.
That probably went through the minds of people attending the recent AARP Planning for Retirement Workshops. The workshops, presented at the Central Arkansas Library’s downtown Little Rock branch and the West Memphis Public Library, helped attendees crunch some numbers for their retirement finances. The workshops’ presenter, Larry Cathey, Investor Education Coordinator with the Arkansas Securities Department, cited the results of a recent study that found 87% of American workers aren’t confident about their retirement.
“Longer life spans, the effects of inflation on future retirement income needs, uncertainty regarding the future of Social Security benefits along with record levels of personal debt,” are leading causes of retirement angst, said Cathey. A case in point: defined benefit plans, aka pensions. One of the traditional “three legs” of retirement planning—personal savings and Social Security being the other two—pensions have been virtually eliminated from the modern workplace. Bureau of Labor Statistics figures show that the percentage of American workers covered by their employer’s pension plan fell from 35 percent in 1990 to only 18 percent in 2011.
The growing importance of self reliance wasn’t lost on the workshop attendees, driven home by Cathey’s mantra of closing income gaps to reach retirement goals. “Tax advantaged saving programs, such as 401k’s, 403b’s and 457b’s can help leverage your personal savings,” Cathey told the Workshops. Establishing good savings habits early was another point; Cathey likened early savings to putting aside a teaspoon of money at a time. Waiting until retirement draws near necessitates using shovels instead of teaspoons.
Cathey ended the programs providing resources from the Department of Labor and AARP aimed at moving the retirement planning process from idea to reality.
Along with the complimentary sandwiches and chips served at the evening’s event, the Workshops gave the attendees plenty to chew on.