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Feb-12-2008 12:05TweetFollow @OregonNews
AARP Highlights Retirement InsecuritySalem-News.com Business Report
Automatic Enrollment of 401(k)s Help Workers Save for Retirement.
(SALEM, Ore.) - Oregon workers face an exciting but challenging "new retirement". There's the promise of longer lives and the reality that many employees may not be saving enough to see them through their retirement years.
One of the best ways for employees to build an adequate retirement nest egg is to maximize saving through their 401(k). But far too many are not doing so.
Almost 1 in 2 workers -- 48% -- have less than $25,000 in savings, and 71% have less than $100,000, according to a 2007 survey by the Employee Benefit Research Institute.
AARP Oregon supports a simple solution, the "automatic 401(k)".
According to a recent study of employer-sponsored retirement plans, employees are nearly unanimous in their support of being automatically enrolled in their companies' 401(k) plans, and feel that automatic enrollment has made saving for retirement easy, as well as helped them start saving for retirement earlier than they had planned.
The "automatic 401(k)" works because saving becomes automatic. Requiring no action on an employee's part effectively eliminates the major stumbling blocks to 401(k) participation. What is the result? More employees save, they save more and they start saving sooner.
AARP has joined with the Retirement Security Project and FINRA to sponsor a website that companies can use to learn more about how to help their employees plan for retirement.
The website, retirementmadesimpler.org, features an Auto 401(k) Toolkit, a brochure called "401(k)s Made Easy: Automatic Retirement Savings" and "Smart 401(k) Investing" by FINRA.
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