Nonprofit Employees Lack Confidence in Retirement Planning, Study Finds

While a majority of employees in the nonprofit sector are satisfied with their current jobs, nearly half lack confidence in their ability to save for retirement, a report from the TIAA-CREF Institute and Independent Sector finds.

Based on a survey of a thousand full-time employees in the nonprofit and philanthropic sector, Financial Security and Careers in the Nonprofit and Philanthropic Sector (17 pages, PDF) found that 59 percent of respondents were very or extremely satisfied with their jobs, with 94 percent reporting that personal satisfaction with the mission of their work was an important driver in their career decisions. At the same time, satisfaction with career advancement opportunities varied with career stage, with only 30 percent of respondents overall saying they were very or extremely satisfied with their advancement opportunities and 36 percent saying they were somewhat satisfied.

The survey also found that 67 percent of women and 47 percent of men said salary was a strong consideration in their career decisions; that 42 percent of respondents felt they were not accumulating enough resources to ensure their long-term financial security; and that 44 percent of respondents had considered leaving the sector for better salary and benefits elsewhere. Despite the fact that most nonprofit employees have access to a retirement plan, 45 percent of respondents were either "not too satisfied" (15 percent) or "not at all satisfied" (30 percent) with their ability to prepare financially for retirement. These concerns could affect the sector's ability to recruit and retain talented employees, the report notes, and inhibit advancement opportunities for younger workers if senior workers feel they cannot retire. The report's recommendations include redesigning retirement plans and programs to address the long-term financial security of employees in the sector and focusing investments on talent among early-career employees.

"We hope this report will deepen our understanding of the issues and propel our community to consider how to secure the financial future of staff and those interested in working in the charitable sector," said Independent Sector president and CEO Diana Aviv. "Financial security will make it possible for these leaders to remain in the sector over an entire career."