Survey: Would you take lower pay for an increased 401(k) contribution?

401k

NEW YORK (CNNMoney) — As millions of Americans struggle to save enough for retirement, many workers say they are willing to accept lower pay if it means their employer will help them build a bigger nest egg.

Nearly half, or 43%, of workers said they would opt for a lower salary in exchange for a larger employer contribution to their 401(k) plan, a Fidelity Investments survey of more than 1,000 working retirement savers found.

“Employer contributions play a vital role in helping Americans reach their retirement savings goals — these contributions represent more than 35 percent of the total contributions on average to an employee’s workplace savings account,” said Doug Fisher, senior vice president of workplace initiatives at Fidelity.

Fidelity noted that many working Americans are only able to save the suggested 10% to 15% of their salary with the help of their employer’s contributions.

According to Fidelity’s data, 79% of workplace retirement plans offer some sort of employer contribution, whether it be a 401(k) match or profit sharing.

Employers pitch in an average of $3,540 (or 4.3% of salary) into worker retirement accounts each year, according to Fidelity.

Over 10 years of saving, that match alone can grow to almost $50,000, assuming 5% annual returns.

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1 Comment

  • Nuclear Mike

    And thus the plan of Corporate America to eliminate ALL the traditional retirement systems to improve their immediate profits at the expense of the workers’ future security is being played out….and so does the concept of employee loyalty to their employer end with the 401K promises.
    Now let’s see the Federal, State, County & City governments do the same to eliminate their retirement systems for the 401K promise verse the immediate gains of not paying out earned retirements.
    “Fidelity noted that many working Americans are only able to save the suggested 10% to 15% of their salary with the help of their employer’s contributions.”…this is the direct result of corporate greed that the workers’ wages have been reduced regardless of their productivity as less & less humans are required for the robotic factories and other factories moving out of the USA to foreign lands. Ross Perot was right about all his fears for America’s loss of jobs.

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