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The Faculty Retirement Report Card

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Retirement Corner

Financial LiteracyWhen it comes to grading your own financial literacy, what grade would you give yourself?

According to Fidelity Investments’ 2017 Higher Education Faculty Study, when it comes to grading their own financial literacy— from budgeting to investing— professors admit they’d give themselves a “B” grade.

While professors feel comfortable with many fundamental financial concepts, there are other areas where extra study is needed. For example, nearly one third (29 percent) of professors aren’t sure of the investment mix of their retirement savings, suggesting they don’t know if the investments they selected align to a specific financial goal and timeline. Encouragingly, as faculty members age, their financial wisdom increases slightly: Boomer professors (born 1946-1964) give themselves a “B+” grade.

The study identified three important insights on how educators feel about their financial knowledge and areas where they would welcome help:

  • Many Professors Feel Like Novice Investors 
    While they have mastered certain subjects in their professional lives, when it comes to investing, 37 percent of professors see themselves as "beginners." Not surprisingly, this sentiment is greater for younger professors with 47 percent of Gen X faculty (born 1965-1980) feeling inexperienced.
  • Worried Retirement Savings Won't Make the Grade 
    While saving for retirement is the top financial priority for professors (42 percent), and their reported average total savings rates for retirement (employee + employer contributions) is a strong 15 percent, more than half (54 percent) of faculty members are concerned that they could outlive their retirement savings. There is a need to be more engaged, and to do so as early in their careers as possible.
  • Extra Help Needed 
    When asked about where they need financial help, the top responses for professors are understanding Medicare/health care costs (34 percent) and choosing specific investments (32 percent).

Fortunately for faculty and staff who work for the University of Texas, UT System’s Retirement Program has partnered with five of the leading financial providers in the nation (Fidelity Investments, Lincoln Financial, TIAA, VALIC and Voya Financial) to offer all UT employees the resources and financial help they need to ensure they get an “A+” when it actually comes time to retire.

To learn more about your UTSaver retirement savings options, please visit our website at www.utretirement.utsystem.edu.

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*Study and Article Courtesy of Fidelity Investments

© 2017 FMR LLC. All rights reserved.