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.