Current Thinking

Some Thoughts on 401(k) Day

Each year, plan sponsors are encouraged to celebrate 401(k) Day by promoting their retirement plan.  This year, National 401(k) Day is on September 8.

Offering participants a plan designed with their best interests in mind, along with effective savings and accumulation strategies, and corresponding decumulation strategies, is critical.  

With that in mind, we are taking the opportunity to use this day to share Pentegra’s top ten tips  for smart retirement planning at any age.   

Top Ten Tips for Smart Retirement Planning

  1. No matter how old you are, take some time to think about a realistic retirement date based on where you are at right now.  This “date” is not set in stone and may change over time, but you have to start somewhere. 
  2. Sit down and do the math using retirement income calculators online to see if you are saving enough for retirement. The results can be overwhelming and might seem unattainable, but it must be done. Make adjustments as needed to your retirement date/savings strategy.
  3. Take advantage of compounding by starting to save as early as you can, but remember that it is never too late.
  4. If possible, increase your 401(k) savings rate every time you get a pay raise, no matter what.
  5. Review your portfolio regularly. Asset allocation decisions are among the most important that you can make. Studies have shown that asset allocation is responsible for as much as 90% of the variability of long-term returns produced by professional portfolio managers.
  6. Do not put all of your eggs in one basket – diversification is key. Do your research.
  7. Remember that every investment has some level of risk associated with it. While no one wants to take unnecessary risks with his or her money, keep inflation risk in mind as well.
  8. Take advantage of the Catch-up Contribution that allows you to contribute even more to your 401(k) account if you are over the age of 50.
  9. Remember to rebalance your account periodically.
  10. Consider changing your investment allocation as your age and life circumstances change.

Take advantage of your 401(k) plan today to help you build financial security and achieve successful retirement outcomes.  

Be sure to get more advice and tips by following Pentegra’s conversation on social media using the hashtag #TalkAboutRetirement.

About the Author

Richard Rausser

Richard W. Rausser has more than 30 years of experience in the retirement benefits industry. He is Senior Vice President of Thought Leadership at Pentegra, a leading provider of retirement plan and fiduciary outsourcing to organizations nationwide. Rich is responsible for helping to shape and define Pentegra’s viewpoint on workplace retirement plans, plan design strategy, retirement success and employee savings trends. His work is used by employers, employees, advisors, policymakers and the media to produce successful outcomes for American workers.  In addition, Rich is responsible for Pentegra’s Defined Benefit line of business, which includes a team of Actuaries and other retirement plan professionals as well as Pentegra’s BOLI line of business.  He is a frequent speaker on retirement benefit topics; a Certified Pension Consultant (CPC); a Qualified Pension Administrator (QPA); a Qualified 401(k) Administrator (QKA); and a member of the American Society of Pension Professionals and Actuaries (ASPPA). He holds an M.B.A. in Finance from Fairleigh Dickinson University and a B.A. in Economics and Business Administration from Ursinus College.