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IT’S NOT TOO LATE TO START SAVING FOR RETIREMENT

 

Those With A Financial Plan Save Twice As Much As Those Without A Plan

 

Planning is easy; it’s the follow through that’s hard.

 

However, for many savers and investors, the establishment of a financial plan with clear goals can be the catalyst to ensure financial comfort during retirement.  “According to studies, people who establish savings goals save twice as much money as those without a financial plan,” said Ohio Securities Commissioner Debbie Dye Joyce. 

 

The Ohio Department of Commerce’s Division of Securities is participating in April’s observance of Saving and Investing Education Month in Ohio.  This observance month, which is part of an international investor education campaign, is designed to encourage consumers to save, invest wisely, and protect themselves against fraud. 

 

According to the 2000 Consumer Confidence Survey, nearly three-quarters of Americans are saving for retirement, but most have little idea of how much money they will need when they retire. "With Americans living longer than ever, retirement security is a serious issue," said Commissioner Dye Joyce. 

 

Of the 76 percent of American workers who said that they were saving for retirement, the majority of those who were able to provide an amount said they have accumulated less than $50,000.  Almost one-fourth of all workers have saved less than $10,000 toward retirement.  

 

Despite these numbers, 69% of savers say they could save an additional $20 per week for retirement.  In 25 years, this amount could grow to $50,000 (assuming a 5 percent annual rate of return.) 

 

Two thirds of savers said they automatically save a pre-determined amount each pay period or each month.  “With the tax-deferred savings programs available at many workplaces, the easiest way for many of us to save is to have the money deducted directly from our paychecks.  This eliminates the universal urge to spend money that is burning a hole through one’s pocket,” said Commissioner Dye Joyce.  “The key to long term savings is having the discipline to establish and follow a financial plan.” 

 

In developing the plan, Commissioner Dye Joyce recommended the following:

 

•           define the purpose for saving and investing;

            •           set short-term and long-term financial goals;

            •           establish a level of risk tolerance;

•           consider which saving and investing products are best for your goals and risk tolerance (including employer-sponsored plans); and

•           stay disciplined.

Once you have a financial plan in place, Dye Joyce said that the word “THINK” serves as a useful acronym when considering an investment opportunity:

 

            •           Treat investment guarantees with skepticism.

            •           Home in on your investment objectives.

            •           Investigate before you invest.

            •           Never be pressured into a particular investment                         opportunity.

            •           Know how your investment funds will be used.

 

If an Ohioan is considering whether to hire an investment adviser to assist in developing a financial plan, they can first call the Division of Securities Investor Protection Hotline (800-788-1194) to check if the investment adviser is licensed and if there are any enforcement actions against them. 

 

In addition, the Division has a publication titled “Who’s Who In The Financial Planner and Investment Adviser Field.”  It explains the testing and educational qualifications associated with the various professional designations used by financial planners and investment advisers.  The publication is available online at www.securities.state.oh.us/Information/113.html or it can be requested by calling the Investor Protection Hotline.

 

When an investor is considering an investment opportunity, Commissioner Dye Joyce strongly encourages Ohioans to “investigate before they invest.”  Ohioans can call the hotline to learn if the brokerage firm and securities salesperson is licensed and if the security being offered is properly registered with the State of Ohio.

 

In addition, a variety of investor education materials can be requested through the hotline or they can be downloaded through the Division’s web site at www.securities.state.oh.us 

 

Note to editors:  The Ohio Department of Commerce will issue news releases every Monday during April to address specific saving and investing topics.  If this schedule does not meet your needs, please contact us. 

 

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The Ohio Department of Commerce’s Division of Securities promotes an honest and fair securities market where individuals and businesses can raise capital and investors can expect a fair return on their investment.  Other Commerce divisions enforce regulations regarding industrial compliance, financial institutions, real estate, liquor, auctioneers, and unclaimed funds, among others.  The department's internet address is www.com.state.oh.us

 

 

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