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 the bionic adviser is the wave of the future

The bionic adviser is the way of the future. We spoke with Simon Roy of Jemstep to get his insights on how technology will continue to impact the industry.

Video Spotlight

Will It Last As Long As Your Clients Do?

Sponsored by Prudential

Video Spotlight

The Catalyst

Sponsored by Pershing

Latest news & opinion

Wealth management firms struggle with lower fees, fewer new clients

Advisers in North America earned less from clients last year and saw a decline in average fees, according to a new report by PriceMetrix.

These investors are allowed to put $500K into a Roth IRA at once

The HEART Act permits rolling all or part of life-insurance and combat-related-fatality payouts directly into the tax-free retirement plan, but few take advantage.

Labor's Alexander Acosta and SEC's Jay Clayton tell lawmakers they will work together on fiduciary rule

In separate appearances before Senate panels, the regulators stressed the cooperation that Republican legislators and opponents of the DOL fiduciary rule are demanding.

Brian Block denies cooking the books at Schorsch REIT

Former CFO claims everything he did was 'appropriate' and 'correct.'

Interns will take on several roles at advisory firms this summer

College students are helping with client prep, firm visioning and long-term projects, among other duties.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print