Just three hours can improve retirement readiness: Study
There’s a lot that people don’t know when it comes to saving for retirement, but even a few hours of simple instruction can make a big difference.
Recent research from Macquarie University in Australia found that people who took a three-hour online course designed by the school determined they could retire a year earlier than initially planned and were more confident about making financial decisions. Researchers included more than 800 people in the study, placing them into four groups: control; retirement course only; retirement course plus financial advisor and career advisor; and financial advice only.
The best results were seen in the group with holistic planning – the group with access to the course and advisors. After that, the group taking just the online course did best, followed by those receiving only financial advice, according to a report of the results published by the university.
Researchers measured financial decision-making, estimated spending, health goals, retirement age and retirement preparation.
The course, which the university has since made available for a fee, includes three modules covering finances, health and career. Addressing issues beyond just financial preparation is necessary, although most people focus exclusively on that when thinking about retirement, the professor who designed the course told the school.
The research was funded by the Australian Research Council and Allianz.
In the US, it’s well known that financial literacy rates are low and that people could use much more help understanding how to save and prepare for retirement. That hasn’t been lost on financial advisors, some of whom volunteer their time to educate the public.
James Sexton, founder of Western Reserve Capital
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