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Retirement Readiness NOW Financial Literacy Leadership Conference
October 2012
Ray Kirk
U.S. Office of Personnel Management
• Manage retirement system for Federal civilian employees
• Approximately 2.6 million active employees
• Approximately 2.5 million annuitants and survivors
• Pay $70 Billion annually in retirement benefits
• Thrift Savings Plan assets - $316 Billion
Financial Education Strategy
• Thrift Savings Plan Open Elections Act of 2004 required OPM develop and implement financial education strategy
• Educate Federal employees on the need for retirement savings and investment
• Provide information on how to plan for retirement and how to calculate the retirement investment needed to meet their retirement goals
Financial Education Model
• Based on a broad holistic approach• Shift focus from “near retirement” to
career-long process• Make informed retirement planning
decisions• Include employer-provided benefits and
broader financial education needs• Include changing needs as a person
moves through his or her career
Networking
Overall Health
Wealth Planning
Retirement Readiness NOW
Late-Career
Mid-Career
Early-Career
Readiness Based on Life Stage
• OPM• Capacity Builder• Coordinator• Catalyst
• Agencies• Develop Agency Plans• Delivery and Support to Employees
• Employees• Commitment to Learn• Take Action
Strategy Responsibilities
Progress
• Federal Ballpark E$timate• Average 20,000 unique visitors per
month• About half complete an estimate• Average 1 ½ scenarios
• Agency level plans
• Resource database
Challenge – TSP Participation Patterns
• Ariel/Aon Hewitt studies found African Americans and Hispanics participate in 401k Plans at lower levels than Whites
• OPM analyzed 2007 TSP participation data to compare minority vs. non-minority and female vs. male participation
• Federal minorities lagged behind Federal non-minorities on all measures
• Participate at a lower level (82.5% vs. 87.8%)
• Lower deferral rate (8.1% vs. 9.8%)
• Lower TSP balances ($54,430 vs. $81,152)
Challenge – TSP Participation Patterns
• Federal females under participate
• Slightly higher participation rate than males (86.4% vs. 85.8%)
• Lower deferral rate than males (8.8% vs. 9.7%)
• Greater G Fund participation (LT 5 yrs: 55.7% vs. 45.2%)(5-10 yrs: 36.9% vs. 31.8%)
• Lower TSP balances than males ($62,527 vs. $79,819)
Challenge – TSP Participation Patterns
