A paycheck in retirement? MetLife shares why this can help employees once they leave your company

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Employees may think they’refinancially prepared for retirement, but a 401(k) cash out may be too tempting for many.

According to MetLife’s recent Paycheck or Pot of Gold survey, 90% of employees would prefer a guaranteed annuity option rather than a lump sum amount of their retirement dollars. Eighty-nine percent would prefer a combination of partial lump sum with a guaranteed monthly income.

大都会人寿(MetLife)负责机构收益年金的副总裁罗伯塔•拉法洛夫(Roberta Rafaloff)说,年金可以防止退休人员在退休后的头几年犯下代价高昂的财务错误,避免购买他们负担不起的东西。A third of those who received a lump sum of their retirement savings have spent all of it within five years, the survey found, highlighting the necessity ofemployer-provided financial support.

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“People are spending more than they should because they don't have the financial background to understand how they should be spending,” Rafaloff says. “Giving people this flexibility to create a retirement income plan that best meets their needs is critical.”

An annuity optiongives employees more peace of mind over their financial situation, the report found. Ninety-six percent of retirees said they felt their budget was more predictable, and 95% said they felt more financially secure.

拉法洛夫说,提供一种年金选择可以帮助改变围绕退休计划的对话。虽然401(k)计划被认为是一种储蓄工具,但重要的是员工要考虑自己缴款后会发生什么。

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Rafaloff说:“员工们在工作期间关注的是尽可能多地存钱。”“这需要重新定义。当他们到了退休年龄时,他们就需要开始考虑将这些资产转化为他们活不了多久的收入,计划发起人真的要在他们的员工的退休结果中扮演关键角色。”

As of January 2020, just 10% of employers offered an annuity option as part of their 401(k), according to Fidelity. Sixty percent of employers declined offering this option because of possible legal ramifications if the insurance companies paying out the annuities went under, Willis Towers Watson research found.

In an effort to protect employers and make these much-wanted programs more accessible, 2019’sSECURE Actexpands legal protections to employers, potentially clearing the way for employers to incorporate these options into their retirement benefits.

“One of the components of the SECURE Act includes a lifetime income disclosure, which requires that your annual plan statement shows what your lump sum is worth and what it equates to as far as guaranteed retirement income,” Rafaloff says. “As employers start to feel more comfortable offering income annuities to their workers, pre-retirees are going to probably have more options to make their money last.”

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Regardless of how employees choose to spend their hard-earned money, providing financial education, as well as folding these options into the retirement plan options employers offer, can go a long way toward helping employees make the best decisions for them.

Rafaloff说:“我们需要确保提供的工具不是一次性的,这是你的一笔钱,想想怎么用它。”“员工明白保证收入很重要,他们想要这样,所以雇主真的需要开始在他们的计划中提供这些类型的解决方案,不只是市场上的零售选择,而是真正让它们成为他们计划的一部分。”

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