We hear a great deal about fostering engagement among participants when it comes to retirement savings. However, with today's prevalence of automated features does engagement still matter? The answer is “yes!"
In our models we have found that people who are highly engaged in activities surrounding their retirement account have much higher deferral rates and are much more likely to trust and heed the communications messages from their recordkeeper and employer. Perhaps most importantly, engagement drives what we call "financial courage" – the strength to stick to their retirement journey regardless of what happens to the market or to their personal situation. Essentially, engagement creates a much higher probability of retirement readiness.