About Letort Trust

LeTort Trust is an Independent Trust Company with a single focus of providing personalized financial solutions to individuals, businesses and institutions. As an Independent Trust Company, we are held to the highest standards of fiduciary accountability in the industry. Our clients depend on the prudence and expert guidance we provide through our customized wealth management and retirement plan services.

 

Who’s Ready for Retirement?

Between the market downturn of 2008 and the sluggish economy, many are having trouble answering this question with a resounding "I am!". 

Statistics from multiple sources paint a dismal picture of the number of Americans in every age group who think they are prepared for retirement. Employees are focusing more on retirement planning, according to the State of US Employee Retirement Preparedness report published by Financial Finesse, but that focus is being overshadowed by steps back in money management behavior.

Findings from the report suggest that only 39% of employees had done a retirement projection and only 18% felt confident that they were on target to reach their financial goal for retirement.

Many individuals, who were on track with their retirement savings prior to 2008, found that the economy, job loss and market drop set them back significantly.  At a time when prudent patience was called for, many instead pulled out of the market, borrowed from their 401(k) or cashed in IRA’s putting a financial strain on their future.

In 2012 Putnam, a leading mutual fund company surveyed over 3,900 working adults between the ages of 18 and 65 regarding factors that contributed to retirement security.  The study entitled: Lifetime Income Scores III, determined many factors that had an influence on the success rate of individuals to be financially prepared for retirement, however, four primary factors of success surfaced as having the most significant impact.

Active Participation in a Defined Contribution or 401(k) Plan – This factor had the greatest impact on success rates and the study revealed that many households were not optimizing this opportunity.

Participation rates within Defined Contribution Plans of 10% or more – Those with active participation rates exceeding 10% had the highest preparedness scores.

Use of an Advisor – When individuals seek assistance and have help from professional advisors in managing their money, their median score was nearly 54% higher than those that invested with no support or advice.

Confidence in Decision Making – Higher confidence resulting from better financial education provided individuals the tools they needed to achieve higher success rates.

Throughout the study, a series of questions ranked individuals with Lifetime Income Scores derived from present value discounting of the future cash flows associated with an individual’s retirement savings and expenses.  The results showed a widening gap between those prepared and those not prepared for their retirement ahead.

The United States Department of Labor has also weighed in on the challenge of preparing for retirement by offering 10 Ways to Prepare for Retirement.  Retirement is a natural part of the workforce life stage and with proper saving, planning and education, can be rewarding for those who take the time to prepare for it in advance.  

The following online quiz gives you insights into some of the questions that you should think about when approaching retirement. Take a few minutes and see if you are prepared for retirement?

Are You Ready For Retirement?