The U.S. stock market suffered its worst day in five years on Friday, April 4, following President Donald Trump's announcement of sweeping tariffs. The S&P 500, Nasdaq, and Dow Jones Industrial Average all posted significant losses. Despite the turbulence, financial experts continue to advise retirement plan investors to “stay the course” rather than react impulsively.
Achieving a comfortable and secure retirement requires careful planning and disciplined financial habits. Here we present five essential strategies to help you succeed.
A recent Fidelity report reveals that over 80% of plan sponsors prefer to allow employees to keep their assets in-plan and withdraw them over time. The number of workers aged 55 and older has increased by 74% over the past two decades, prompting plan sponsors to focus more on how participants transition from saving for retirement to living in it.
Despite the importance of retirement planning, a staggering 67% of investors admit to spending no time at all working on it in a typical month, according to a recent survey conducted by the Nationwide Retirement Institute. That’s a vast majority of investors failing to take even small steps toward securing their financial future. For plan sponsors, this presents both a challenge and an opportunity.
Generation X — comprising those born between 1965 and 1980 — faces unique financial and social pressures that have left almost half of them with no retirement savings. Compounding these challenges, only 1 in 10 Gen Xers plans to delay filing for Social Security until age 70 to maximize their benefit, due in part to concerns about the program’s long-term solvency. For plan sponsors, providing tools and resources tailored to this generation’s needs can play a crucial role in helping them take meaningful and measurable steps toward retirement readiness.
When considering short-term funding options, participants are often advised to avoid tapping into their 401(k) accounts through loans or hardship withdrawals, as early withdrawals can impede long-term retirement savings. However, the SECURE 2.0 Act of 2022 has introduced more penalty-free emergency withdrawal provisions, offering increased liquidity and flexibility within 401(k) plans. While some see this as a risk to retirement balances, a recent Vanguard study found that participant contribution rates tend to remain stable before and after taking loans or hardship withdrawals.