,"... there is a lack of awareness about the climate impact of retirement investment options for individuals. For employers, the main..." Spending down retirement savings is a complicated equation to solve. Penn professors that the DP spoke with said that there is a lack of awareness about the climate impact of retirement investment options for individuals. For employers, the main challenge is to find the right balance between providing retirement benefits and managing costs. From there, plan fiduciaries have a range of investment options to choose from that may or may not be sustainable.
Early retirement is becoming more common, and many people intend to leave the workplace at an early age. The choices you make as a young adult might very well decide the amount of money you have to live on in your later years. Therefore, it is important to be aware of the impact that retirement investment options have on the environment.
The Department of Labor (AMEX:DOL) has been working to make it easier for employers to offer sustainable investment options in their retirement plans. In 2020, they issued a rule permitting plan fiduciaries to consider environmental, social, and governance (ESG) factors when making investments. However, some companies are still hesitant to offer sustainable investments due to the additional paperwork and potential legal issues.