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The best advice I’ve ever gotten: National 401(k) Day

September 09, 2022
By Amelia Dunlap
Man and woman at work.

Key Takeaways:

  •  National 401(k) Day is celebrated on September 9 to help Americans better understand their retirement plan by bringing awareness to the importance of saving for retirement.
  • According to the Nationwide Retirement Institute®, less than 6 in 10 employees have a positive outlook on their retirement plan and investments, which is down significantly from 2021. 1 Knowing this, National 401(k) Day is a great time to engage clients and discuss their retirement plans.
  • Another way to engage clients on the topic of retirement planning could be sharing some of the advice that Amelia Dunlap, VP of Retirement Plans Marketing at Nationwide Financial, received about working hard in your first job and contributing the maximum amount to your 401(k).

When I started my first “real job” after college, I was hired at consulting firm as a contractor. One week into working, my older brother—who always tells me what to do—gave me two important pieces of advice:

  1. You haven’t been hired yet, so you need to earn the right to be a full-time employee.  Once you are, make sure your employer never regrets that decision.
  2. As soon as you’re hired on full-time, put the maximum amount in your 401(k). That money doesn’t belong to you yet. It belongs to you in 40+ years.

We grew up on a family farm, so the corporate world was an entirely new experience for me. I figured my brother knew much better than I did, so I heeded his advice and worked hard to get hired on full-time. And at the age of 22, I officially started saving for retirement.

A few decades later, not only am I incredibly thankful that I followed his advice, but I have also committed my career to helping America’s workers prepare for and live in retirement. Back then, I didn’t realize that my situation was a bit of an anomaly: having the great fortune of someone advising me very early in my career, and me following his advice. Maxing out my 401(k) contributions from a young age really made a difference for me. It’s my most sincere hope that I can help more people learn that important lesson as early as possible in their retirement-saving journey.

Today is National 401(k) Day and at Nationwide Retirement Solutions, we service retirement plan participants across all types of markets, employers, plan types and tax codes. While there are few universal truths in life, this is one area that we see as a common trend – we all could be doing more to save for retirement, especially now. With recent market volatility, many people have an emotional reaction and pull their money out of the market, reduce contributions, or stop saving altogether. While concern and fear for one’s financial well-being is natural, it’s important that participants are—at a minimum—staying the course on their retirement saving. And that’s where a trusted financial professional can make the difference with their clients.

Nationwide Retirement Institute recently conducted a survey of retirement plan participants across all markets and plan types (401k, 403b, 457) and found that less than 6 in 10 employees have a positive outlook on their retirement plan and financial investments. Moreover, positive outlook is down significantly from 2021 (58% vs 72% in 2021). This loss of confidence is concerning, as we have long been facing a crisis of confidence and preparedness for retirement. In the same study, we are also seeing that many workers (40%) are delaying retirement longer than they had planned by around 4 years.2

While a lot of financial planning and retirement saving depends on market, investment performance, and savings rates, consider this: for those 4 extra years on average that Americans are working, could that extra time have been avoided by just 1 additional year of saving early on? This National 401(k) Day, I hope that financial professionals can help spread the word on the importance of saving early—and not just today, but every day to come. Guiding people to start saving for retirement early is one of the impactful changes we can make to help workers feel more confident in their plans for retirement.

For more information on saving for retirement, you can read our blog Tips for Retirement Income Planning.

Sources

  • [1]

    Nationwide Retirement Institute 2022 In-Plan Lifetime Income survey

  • [2]

    Nationwide Retirement Institute 2022 In-Plan Lifetime Income

  • Nationwide Retirement Institute 2022 In-Plan Lifetime Income Edelman Data & Intelligence conducted a 20-minute online survey among the following audiences:

    • 500 Company Plan Sponsors/Benefits Decision Makers. Business executives, business owners, human resources professionals, and financial management professionals who are full-time workers at U.S. businesses with at least 10 full-time employees. They must also be decision-makers for company retirement plans including 401(k), 403(b), or 457(b) plans)
    • 100 Public Sector Plan Sponsors/Benefits Decision Makers. Full-time employees of a public sector entity (federal, state, local govt) that offers a defined contribution retirement plan to its employees. Must have some level of decision making regarding these plans. Can include HR, financial management professionals or government executives/senior managers with decision making authority.
    • 1,000 Plan Participants (45+). 45+ years of age, full-time worker, who has access to 401(k), 403(b), 457(b) or a government defined contribution plan at their work. Sample included a minimum 100 government plan participants.
    • 100 Plan Participants (35-44). 35-44 years of age, full-time worker, who has access to 401(k), 403(b), 457(b) or a government defined contribution plan at their work.

NFM-22341AO

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