According to the most recent Fidelity Higher Ed Retirement Readiness Survey, financial literacy and retirement readiness for professors needs some improvement.
Below I will highlight the survey results and give you some advice to remove the guesswork from these items…
Many Professors Feel Like Novice Investors
“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.” How do we remedy this?
I’m a big believer in the endless pursuit of learning. Reading my blog posts, and subscribing to my newsletter, will help as I craft content geared to Higher Ed. You can also check out the following books to get more basics on financial literacy/investing:
Professors are Worried that They’ll Outlive Their Money
“More than half (54 percent) of faculty members are concerned that they could outlive their retirement savings.”
Most of the families I meet with have never figured out how to make all of their household assets align with their goals and work efficiently together. Diligently saving to build a nest egg is supremely important, but you’re not done there. You need to have a retirement income plan in place and track it. Retiring comfortably is great but staying comfortably retired is better.
Professors Acknowledge that Additional Guidance is 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)”
This reiterates to me the need for financial planning. A true financial planning relationship will help you gain clarity that you’re leaving no stone unturned. There is more to your finances than your 403(b), and don’t get it twisted, your 403(b) representative is not delivering comprehensive planning and advice. (for more: How to Remove the Guesswork from Your Benefits Elections)
One Concern that Always Pops Up: Student Loans
Do you have questions on the best way to manage your student loans? Are you on track for public service loan forgiveness?
Conclusion: Increasing Financial Literacy for Professors
On the whole, professors gave themselves a “B” grade for financial literacy. A “B” leaves room for improvement. After all, do you want to live a good financial life or would you rather live your best financial life?