Over three-quarters of U.S. households are confident 401ks and other employer-sponsored retirement plans will help them reach their retirement goals. Of those already investing in direct contribution (DC) plans or individual retirement accounts (IRAs), confidence was even higher—a whopping 84 percent.
A new survey from the Investment Company Institute (ICI) revealed that, in particular, Americans sing high praises for DC accounts. Half of those surveyed admitted it’s unlikely they’d even be saving for retirement at all if it weren’t for such plans.
“DC plan participants appreciate the convenience of payroll deduction and the incentive of the tax treatment of these plans to encourage savings,” said Senior Director of Retirement and Investor Research Sarah Holden.
An amusing yet unsurprising twist: the tendency to overshare in the social media age has led to bragging on Twitter and Reddit about just how much some people’s 401ks have racked up. (President Trump might’ve had a little to do with it, too, by asking “how’s your 401k?”)
“Meet a Reddit user going by the name ‘Subject—Beef,’” writes Sally French, social media editor for MarketWatch. “He has contributed $308,000 to his 401k since 1995 and posted a detailed rundown on his yearly contributions and resulting balance of $1,007,375.50.”
The ICI survey indicated that 63 percent of Americans who don’t even participate in DCs or IRAs are confident about them. And in a separate study by the Employee Benefit Research Institute, 3 out of 4 of workers without retirement savings accounts said they would be somewhat likely to sign up for a plan if contributions were matched by their employer.
Considering the data, it’s no surprise that an overwhelming number of people disapprove of the government making policy changes to DC plans.
“About nine out of 10 US households opposed reducing the amount individuals can contribute or reducing the amount that employers can contribute,” ICI concluded. Similarly, “nine out of 10 US households rejected the idea that the tax advantages of DC plan accounts should be taken away.”