Issue link: http://digital.copcomm.com/i/1036712
Fall 2018 | wyoea.edu X 18 Fall 2018 | wyoea.edu Complacency. When I did start saving in the WRS 457 Plan, I rarely increased my contributions, except when I got a pay raise. Even though I never missed the salary taken out by payroll deduction, I kept my savings percentage essentially the same for decades. I should have planned to increase my contribution once a year. Some states and other employers do this automatically for employees, again with an opt-out provision. WRS is taking a look at this option. You and your employer should also look into this. Unrealistic risk aversion. I invested too conservatively. Knowing little about the stock market or asset allocation or any of that esoteric stuff , I invested 100% of my contributions in the most conservative option in the 457 Plan investment menu. I was avoiding any market risk, yet exposed myself to the real risk of not outpacing infl ation. The WRS 457 Plan now off ers a choice of target date investments that align age with decreasing percentage of risk as your age increases. If you want help determining your investment mix, these funds are suitable for you. No goal-setting. I did not set a specifi c amount I wanted to have in my 457 account at retirement. Why not? Beats me, but I know I would have had more in there if I had just taken that small step. You have to navigate even more decision making than state agency employees, because you might also have access to 403(b) plans available to educational employers. When it comes to 403(b) off erings, it is important for the buyer to beware. That market can be rife with high-cost and low-quality products. For detail, see the New York Times' fi ve-part series on the issues with the 403(b) market originally published in 2016. I recount the things I wish I had done diff erently to 1) encourage individuals to be more informed about retirement planning and 2) encourage employers to use advances in the retirement industry to guide their employees in the right direction. Thanks to a Nobel Prize winning economist, Richard Thaler, the retirement industry and related laws now support automatic features that "nudge" people. The private sector has fully embraced automatic enrollment, or the opt-out approach, to enrolling employees in private sector 401(k) plans because it creates better retirement outcomes. The WRS Board of Trustees advocated to change state law to allow automatic enrollment into the WRS 457 Plan. The State of Wyoming has been auto-enrolling new state agency employees for three years, with excellent results. Employees see it as a service the employer provides; very few opt out. I want to make sure school district offi cials and employees alike know that a school district can elect to implement automatic enrollment into the WRS 457 Plan. You and your employer should consider it, and contact WRS to implement it. I hope this article has been a help to get you to think of steps you can take on your own and with your employer to make retirement even better for you. Believe it or not, it will be here before you know it! *Disclaimer. This article has not been submitted to the Board of Trustees of the Wyoming Retirement System. It is based on the author's personal experience and knowledge of the Wyoming Retirement System,and expresses the personal views of the author.