The Wall Street Journal recently interviewed Joshua Gotbaum, director of Pension Benefit Guaranty Corp and Dallas Salisbury, President of the Employee Benefit Research Institute. They expressed their concerns about the current state of retirement in the United States and possible solutions. The majority of retirement plans that are offered by employers are defined contribution plans. The burden is placed on individuals to figure out how much they need to save and how to save it. Mr. Gotbaum concluded that Americans aren’t doing this very well and fears that the baby boomer generation will have less ability to retire than previous generations. The interviewer broached the topic by asking who was to blame for the instability of the retirement system in America. Mr. Gotbaum’s response was to say we should instead focus on improving the institutions that can help Americans to save, including employers. This doesn’t mean employers have to contribute more to employees’ retirement, maybe just help employees save more of their own resources wisely.
In what ways are your plans constructed to help participants save wisely?