This paper was written in conjunction with the New tools for a better retirement: Dashboards and tontine solutions for Americans event on September 17, 2020.
Navigating the American retirement system is not easy for many people. Because most workers change jobs (and hence retirement plans) multiple times during their career, developing a comprehensive picture of one’s retirement preparations can be challenging. In addition, successful retirement saving strategies can be undone rapidly if funds are withdrawn before or soon after retirement begins, even if there are good reasons for such withdrawals. More generally, planning for retirement is a complicated and uncertain exercise, and unbiased information is often difficult to identify.
Workers across the world face similar problems. To help address these issues, several governments and pension providers have created pension registries—websites where people can see all their retirement benefits, including Social Security, employer-sponsored or “occupational” plans, and individual retirement accounts, and find contact information for the administrator of each plan or account. Other countries have gone further to develop national, online retirement “dashboards”—websites that not only include a registry or tracking system but also offer expanded functions such as recovering and consolidating lost accounts, projecting estimated future income, expanding financial literacy, and providing unbiased financial advice to users.
In this paper, we discuss the possibilities for a retirement dashboard for the United States. While it would not address systemic problems such as coverage, a dashboard could reduce the strain that a complex retirement system imposes on households. An effective dashboard could help employees and other savers, employers, recordkeepers, asset managers, plan providers, and the government, all of whom have an interest in ensuring that workers understand and manage their retirement savings appropriately.