How Might Automatic Enrollment Affect Your Retirement Outlook?

If you’re like many Americans, you’re working hard to maintain a comfortable quality of life. You may be doing fine now, but have you given any thought to your retirement funds? If not, now is the time to do so. Starting in 2025, certain employers must automatically enroll their employees into their company’s retirement plan. This can have a positive effect on your retirement outlook, and here’s why.

Key Takeaways:

• Participating in a plan earlier gives you more time to save.
• You’ll have the flexibility to change your contribution amounts and investment options.
• Your ePlan Services participant dashboard can show you how much you may need during retirement.

Early participation can boost your retirement outlook:

Suppose retirement is a faraway concept for you now. In that case, auto-enrollment in your company’s retirement plan presents you with a perfect opportunity to set up your retirement fund and forget about it. Your employer will simply auto-enroll you in the company’s retirement plan at a default contribution rate from each of your paychecks. Plus, the added auto-escalation feature will ensure that your contribution rate increases by 1% every year so you won’t have to worry about becoming stagnant with your savings plan.

The longer you’re employed and leave your money untouched, the more tax-deferred money you stand to gain for your retirement. For instance, you can reduce your taxable income by $23,000 in 2024! Once you are 50 years old or older, you can start to contribute annual catch-up contributions of up to $7,500 (2024) to add even more funds to your retirement nest egg.

Improve your retirement outlook by adjusting your contributions:

After your employer enrolls you in your company’s retirement plan, a default amount detailed in your automatic enrollment notice will automatically transfer into your account from your paycheck. Want to change this amount? With the ePlan Services participant dashboard, you have the freedom to change your contributions as you see fit. This is ideal if you’d like to save more aggressively or make smaller contributions until you’re comfortable contributing more. It’s

important to note that the contribution limit for 2024 is $23,000. For more information about plan contribution rates reach out to your plan administrator.

View your dashboard to estimate your retirement outlook: Your ePlan Services dashboard also has a retirement outlook calculator so you can estimate how much you’ll need to retire comfortably. Just input information such as your plan type and retirement age. The amount you may have and the amount you may need will be displayed right in front of you. Then, editing your contributions to reach your goals is only a handful of clicks away. Plus, you can also read other useful tips about how to stay on track such as learning how small contribution percentage increases can affect your account and more.

Conclusion:

If you’re currently in the workforce but haven’t given any thought to your retirement savings, the new auto-enrollment mandate may be just what you need to positively affect your retirement outlook. The best part is that auto-enrollment gets you started with saving for retirement so you can focus on working smarter and harder. Plus, ePlan Services’ dashboard makes adjusting your contributions and determining what you need for retirement a breeze.