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6 Obstacles To Retirement: Part 1

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Chad Parks is Founder, President, and CEO of Ubiquity Retirement + Savings, formerly The Online 401(k), has helped savers contribute over $1.4 billion towards their retirement since 1999. As one of the first flat-fee-for-service small business plan providers in the nation, Ubiquity delivers peace-of-mind with zero hidden-fees in the fine print. The company is headquartered in San Francisco with satellite offices from coast-to-coast. Read More...

Parks started out as a broker in the financial services industry by growing a portfolio of individual clients at San Francisco’s Piper Jaffray. Driven by a desire to better serve his clients while anticipating the phasing out of the traditional broker model, Parks left Piper Jaffray in 1997 to obtain his CFP designation and start his own fee-for-service, independent financial planning practice, Retirement & Education Group, Inc.

In his financial planning practice, Parks came across many small business owners looking for cost-effective and quality retirement plans. Finding the small business market highly neglected and underserved, Parks saw the opportunity and took it by launching The Online 401(k). Today, Ubiquity serves more than 7,000 small business customers in 50 states, providing solutions both directly and through partners, such as Zenefits, Charles Schwab & Co. and Morningstar, as well as payroll companies, financial planners and CPAs.

Parks has been quoted in many financial services as well as national publications such as The Wall Street Journal, The New York Times, Fox Business, Yahoo! Finance, USA Today, CNN Money, Bloomberg Wealth Manager, Business Week, Entrepreneur and Plan Sponsor for his considerable work performed in the space of small business retirement as well as his foray into documentaries with his independently produced Broken Eggs Film, released in 2014.

With his extensive work in Washington DC in getting legislation passed in order to stop the practice of hiding fees in the fine print, Parks has become the go-to expert on public policy as it relates to 401(k), as well as the looming retirement crisis in America, and what we can do to fix it.

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August 10, 2015 at 10:08 am
Retirement News

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The looming retirement crisis is a term that sounds ominous – and it is. Millions of Americans dream of a retirement that includes their hobbies and loved ones. Unfortunately, the harsh reality is that many of those dreamers will never actually get to retire because of a seriously inadequate nest egg that is supposed to sustain them through their twilight years.

America needs to wake up and realize we have a serious problem on our hands. It’s not an abstract one, but rather an issue that has specific origins. We have no chance at reversing the problem without figuring out how we got to this point and what we need to do to prevent the looming retirement crisis.

This post, the first in a three-part series, will outline the obstacles Americans face that prevent them from retiring comfortably and offer tangible solutions.

1. Coverage

Study after study has shown the easiest and most effective way for people to save for retirement is through an employer-sponsored retirement plan, whether it’s a 401(k), IRA or another vehicle.

Over 40 million employees – especially those working at small businesses – don’t have access to a work-sponsored retirement savings plan. Check out the chart below that details coverage by employee size (source: GAO “Private Pensions” March 2012). As you’ll see, this is an incredibly important obstacle that needs to be overcome.

Our solution? Mandated retirement savings plans. The government is getting involved in this solution, but more needs to be done so that all workers have the opportunity to save at work.

2. Participation rates

Even among employees with the opportunity to save at work, there is an alarmingly low participation rate of only 52 percent, according to the Bureau of Labor Statistics. The retirement industry and government need to find a way to get people to utilize their plans and save money for their future. When employees have to opt in to a plan, many wrongfully assume they need the money more now than they will later.

Our solution? Auto enrollment. Research indicates that when people are auto enrolled in a retirement plan, they stick with it after seeing how easy it is to use and its benefits.

Stay tuned for another blog post on this topic where we will tackle two more obstacles that need a resolution so we can win the fight against the looming retirement crisis.