Saving for that rainy day called ‘retirement’

Well, sometimes it really does help to force people to do what’s good for them.

The recent change to provide new feds with automatic enrollment in the Thrift Savings Plan likely will turn out to be one of those things.

According to a study commissioned by a coalition called Retirement Made Simpler, and conducted by the Center for State and Local Government Excellence, a similar move to institute an automatic enrollment plan for newly hired state employees in South Dakota produced “a staggering leap in participation rates.”

The study tracked the participation rates in several dozen South Dakota government units in the first eight months of the automatic enrollment program. According to the study, 91 percent of new, eligible employees in units that adopted automatic enrollment are participating in the state’s Supplemental Retirement Plan—a tax advantaged deferred-compensation retirement savings plan offered to members of the South Dakota Retirement System—versus a mere 1 percent of new hires in units without automatic enrollment.

While the differences are not so stark among feds, we’re wondering how long it took you “pre-automatic” TSP enrollees to avail yourself of the plan. Were you a conscientious, early saver? Or did you wait until retirement started looming dangerously on the horizon?

We’d also like to know haw many of you have not opted in at all (a phenomenon more prevalent among younger feds)