Legg's plan for savings

Nov 11, 2012 @ 12:01 am

By Darla Mercado

To take advantage of football season, the Legg Mason Retirement Advisory Council has kicked off the First & Ten retirement savings program.

First & Ten is Legg's latest effort in a series of projects intended to encourage people to sock away cash for retirement. It encourages workers to enroll in their workplace defined-contribution plan or ask their employer to set up a retirement savings vehicle if they lack one.

Employees then are asked to put at least 10% of their annual salary into the plan.

Gary Kleinschmidt, head of retirement sales at Legg Mason Inc. and a member of the advisory council, noted that the average person is saving 5.4%.

“That's not nearly enough,” he said. “People will outlive their income. How are you going to fund health care in retirement?”

The council offered this example: If a 25-year-old worker with an annual salary of $30,000 begins the First & Ten strategy now, by 67, he or she could save as much as $1.25 million in a retirement plan that achieves a 6.6% pretax annual rate of return.

Mr. Kleinschmidt said that after the 2008 economic crisis, when many 401(k) plans and other nest eggs lost much of their value, many people looked at investments as a culprit, but the real problem is an inability to save in the first place.      

0
Comments

What do you think?

View comments

Recommended for you

Featured video

Events

Why does social media matter for financial advisers?

Social media is a reflection of who you are. But who are you as a financial adviser? Debra Bednar Clark of DB+co. offers some solutions to enhance your practice.

Video Spotlight

Help Clients Be Prepared, Not Surprised

Sponsored by Prudential

Recommended Video

Path to growth

Latest news & opinion

Broker, retirement groups make last-minute pleas to change tax legislation

Pass-through provisions are target of groups representing employee-model brokerage firms, as well as retirement plan advisers.

House and Senate reach tentative compromise for tax overhaul

Lawmakers still need to get a cost analysis of their agreement, so it's not yet definite, according to a source.

Advisers' biggest fears for 2018

What keeps advisers up at night.

One adviser's story of losing his son to the opioid epidemic

John W. Brower, president and CEO of JW Brower & Associates, shares the story behind his son's death from a heroin overdose and how it inspired him to help others break the cycle of addiction.

Tax reform will boost food, chemicals, rail stocks. Technology? Not so much

Conagra and Berkshire Hathaway are two stocks that should benefit most from changes in the tax code.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print