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DISB Encourages Saving During the Second Annual “National Save for Retirement Week”

Monday, October 19, 2009
The US Congress as has designated October 18-24, 2009 as “National Save for Retirement Week,” formally calling on local and national public, private and federal employers to promote the benefits of saving for retirement and encouraging employees.

  (Washington, DC) — October 18-24, 2009, has been endorsed by the US Congress as “National Save for Retirement Week,” formally calling on local and national public, private and federal employers to promote the benefits of saving for retirement and encouraging employees to take full advantage of employer-sponsored plans. “The District of Columbia is participating in ‘National Save for Retirement Week’ to help employees understand their personal responsibility for their retirement future and the benefit of using their defined contribution employer-sponsored plan to prepare,” said Acting Commissioner Gennet Purcell of the DC Department of Insurance, Securities and Banking (DISB). “We understand the importance of our employees being financially secure in retirement so they can make a positive impact on the community economically, with their volunteer time, and as contributing citizens, as studies indicate many people stay in their community once retired.” DISB will join the National Association of Government Defined Contributors Administrators (NAGDA) in using “National Save for Retirement Week” to: Help employees be more aware of the need to save now for the future Promote the benefits of getting started saving for retirement early Create a culture that promotes and values saving in the workplace and the community. Experts predict that retirees will need from 80 percent to 100 percent of their pre-retirement income to maintain their lifestyle after retirement. Yet, surveys show that most Americans remain unprepared for retirement. Many employees already participate in the defined benefit or defined contribution plan, which provides a foundation for retirement, in addition to paying into Social Security. However, that won’t be enough. “You will need to add your own retirement savings to live comfortably during your retirement years—to fulfill your dreams,” Acting Commissioner Purcell added. So it is important to begin saving today for retirement—or increase contributions if you aren’t meeting your goals, the Commissioner said. National Save for Retirement Week is dedicated to showing you how important it is meet objectives, by contributing regularly and investing wisely for the long term. Here are a few simple steps to take today to be prepared when it’s time to retire: If you save just $10 per week in your 457 deferred compensation plan for 40 years and earn an average rate of return of 7 percent, you will have over $100,000 in your account. That just shows the power of tax-deferred savings. If you start a little later, don’t be discouraged. You can still save more than $73,000, by setting aside $60 a month in your tax-deferred savings account for 30 years and earn a return of 7 percent. If you are saving now and increase your contributions, you can really make a difference in your final total. Over 30 years, adding $25 to your $100 biweekly contribution can increase your account from $264,327 to more than $330,409, assuming you earn 7 percent. Saver’s Credit. Sometimes saving seems really hard, especially if your income is limited. The government has a special Saver’s Credit just for you. If you are eligible, you can actually receive money back when you file your tax return. When it comes to saving for retirement, there is never a better time than today to assess your prospects toward meeting your goals. As the open season for government employees approaches, DISB is encouraging its employees to take advantage of National Save for Retirement Week. Save now—your retirement future starts today. There are many resources available on the Internet with information on planning for retirement. Here are a few sites: www.ssa.gov – Social Security Administration—You will find calculators to determine what your benefit will be, information on how to apply for benefits and other information about the government retirement system. www.asec.org –American Savings Education Council—A useful calculator helps you estimate how much you need to save to meet your retirement goals as well as a number of savings tips and useful brochures. www.aarp.org/money—American Association of Retired People—has financial planning guidelines for retirement. NAGDCA is the country’s leading organization of defined contribution retirement plan administrators and financial service providers. It represents nearly every state deferred compensation plan, as well as numerous other governmental and public sector defined contribution plans, and over 150 companies in the financial services industry.  Its mission is to focus on retirement planning for public sector employees participating in 457(b), 403(b), 401(a) and 401(k) retirement plans.