Nationwide Retirement Education Institute study cites increases in public
sector participation - still work to be done
COLUMBUS, Ohio, April 12 /PRNewswire/ -- The Nationwide Retirement
Education Institute(SM) published a report today that shows more government
employees are investing for retirement. The Institute is sponsored by
Nationwide Retirement Solutions, the division of Nationwide Financial
Services, Inc. (NYSE: NFS) that specializes in providing supplemental
retirement plans to government employees.
The report, entitled America's Retirement Voice: Trends in Public
Sector Retirement Plans takes a comprehensive look at the public-sector
retirement system with respect to participation and investment trends,
demographic differences among participants and highlights on how
public-sector participants differ from their private-sector counterparts.
Compared to the first report published in 2004, the new study shows many
positive trends in public sector retirement saving and investing habits
including:
Increased Participation:
- Overall participation rates increased from 30 percent in 2003 to 34
percent in 2005, however, public sector plan participation continues to
lag behind 401(k) plans which average 70 percent participation.
Improved Investment practices:
- Participants who are invested in three or more asset classes rose from
19 percent in 2001 to 39 percent in 2005.
- Average annual contributions increased by eight percent to 20 percent
or from $3,500 in 2003 to almost $3,800 in 2005 among all participant
age groups.
Younger participants are getting the message:
- Those aged 18 - 25 increased their average annual contributions by 20
percent since 2003, compared to a range of nine to 17 percent in other
age groups.
- Almost 30% of participants who are ages 18 - 25 selected an asset
allocation option (lifestyle and lifecycle funds) as their single
investment choice for ongoing deferrals, showing an understanding of
the need to diversify investments, compared to a range of 3% to 18% for
all other age groups.
"We're encouraged to see that education is working," said Matthew
Riebel, president of Nationwide Retirement Solutions. "More people are
getting the message 'my retirement matters now,' but we still have a long
way to go. With less than half of all eligible government employees
participating in their employer's plans, we need to debunk the perception
that, 'my pension will cover all my financial needs in retirement' and
motivate people to jump on the personal savings bandwagon."
Riebel continued, "As people live longer and health care costs
escalate, it is likely that employees will need to save more on their own
to satisfy these needs in retirement. Plan sponsors are in a unique
position to help them bridge the gap by offering strong supplemental
savings programs.
Plan sponsors, providers and policy makers must collaborate to do
everything possible to encourage and simplify personal investing at the
individual level. I hope this research will shine a light on the need to
invest and prompt people to take action."
An executive summary and report methodology may be obtained by visiting
http://www.NRSFORU.com.
About Nationwide Financial
Nationwide Financial Services, Inc. (NYSE: NFS), a publicly traded
company based in Columbus, Ohio, provides a variety of financial services
that help consumers invest and protect their long-term assets, and offers
retirement plans and services through both public- and private-sector
employers.
It's part of the Nationwide group of companies, which offers
diversified insurance and financial services. The group is led by
Nationwide Mutual Insurance Company, which is ranked No. 98 on the Fortune
100 based on 2005 revenue(1). For more information, visit
http://www.nationwide.com.
Nationwide and the Nationwide Framemark are federally registered
service marks of Nationwide Mutual Insurance Company. Nationwide Investment
Services Corporation, member NASD. In MI only: Nationwide Investment Svcs.
Corporation. The Nationwide Retirement Education Institute is a service
mark of Nationwide Mutual Insurance Company.
(1) Fortune Magazine, April 2006
Contacts:
Hillary Jeffers (614) 677-8978
jefferh1@nationwide.com
Erica Lewis (614) 249-0184
lewise6@nationwide.com
SOURCE Nationwide Financial Services, Inc.
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Related links:
http://www.nationwide.com
http://www.NRSFORU.com
CONTACT:
Hillary Jeffers, +1-614-677-8978, or
jefferh1@nationwide.com, or Erica Lewis, +1-614-249-0184, or
lewise6@nationwide.com, both of Nationwide Financial Services,
Inc.
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