It Pays to Participate

From CBS News...

Only 49 percent of all American workers participate in a workplace retirement plan. Of the rest, just more than one-third have no savings plan at work, and 17 percent are eligible to participate but don't contribute to their plan. Many are part-time or low-income workers and are particularly vulnerable.

Here's just one compelling example of the power of these plans: The Employee Benefit Research Institute (EBRI) projects that more than half (56 percent) of all moderate-income Gen-Xers who don't participate in a savings plan at work will run out of money in retirement. By contrast, the EBRI projects that among workers who save for at least 20 years in a work-based plan, only 12 percent will experience that fate.

If you're eligible for a work-based savings plan but don't contribute, sign up as soon as you can. If that's a stretch, sign up for a low contribution rate, such as 1 percent of your salary, and increase your savings in future years. If you're not eligible to participate, you can start contributing to a myRA or an IRA at a financial institution such as a bank, mutual fund company or insurance company.

If you spend all of your paycheck on current needs, see if your employer or financial institution offers a financial wellness program that can help you squeeze some savings out of your daily budget.