LACERS Web Survey Results Show Members Need More Preparation for Retirement

From April-June 2004, we posted a survey on this website to find out how prepared our active Members were for retirement. Of 26,000 active Members, 2,039 active Members (or 8%) completed the survey. Although by no means definitive of our total active Member population, the survey, nonetheless, gives us some insight about the retirement preparedness of those who did participate.

Among the key findings were:

• 91% of respondents were over the age of 36
• Only 18% believed that the time to plan for retirement was "30 years or more" before retiring (financial planners agree that this is the best answer)
• Less than one-half of 1% believed they were "very prepared" for retirement
• 31% plan to retire in 5 years or less
• 73% believed that their LACERS retirement benefits are not enough
• 54 % knew that 30 years of service credit would result in a monthly retirement allowance that is approximately 65% of their salary
• 88% had not even considered their healthcare options
• 72% did not know that purchasing Medicare Part B was a requirement to enroll in a LACERS healthcare plan
• 67% had no knowledge of their LACERS medical subsidy
• 64% were aware of options to increase their retirement income
• 72% felt they had "average" to "below average" knowledge about financial planning
• 63% were interested in learning more about wills, trusts, and estate planning
• 46% were interested in long-term care insurance
• 42% were interested in income tax planning
• 65% preferred obtaining LACERS information through our website
• 61% preferred obtaining LACERS information through newsletters and brochures
• 65% would likely attend a LACERS Financial Planning course

It was surprising to learn that many people did not fully understand their LACERS benefits. Although LACERS will provide you with a retirement allowance and health benefits, these are not likely to cover all of your retirement expenses. It is important to develop strategies to enhance your income after retirement. We were pleased to find that the majority of active Members are interested in learning more about retirement planning (i.e., financial planning) and would attend a LACERS financial planning seminar if one were offered. However, we were concerned that very few people under age 36 participated in this survey.

Most financial planners believe that the time to start planning for retirement is as early as possible. All too often, however, people begin planning for their retirement later, rather than sooner, in their careers. Creating a path to your future financial security, regardless of your income, should begin early in your career. LACERS wants to help you get started.

In the months ahead, LACERS will develop publications and seminars to assist Members in reaching their goal of a more financially secure retirement. Watch for more information in the near future.

Member Communications/jta
September 2004