Report: One in five workers near retirement have no money saved

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WASHINGTON — One in five people near retirement age has zero money saved.

The sobering statistic was one of many released by the Federal Reserve.

The study offered a stark reminder that as more Americans are made responsible for their retirement savings, most are not saving nearly enough.

Overall, 31 percent of people said they have zero money saved for retirement. That included 19 percent of people between the ages of 55 and 64 — those closest to retirement age.

What’s going on here? Many people said they rarely thought about retirement, at least not until it was too late. About 41 percent of people ages 18 to 29 said they never thought about retirement planning, a measure that declined to 20 percent for people above the age of 60.

But researchers said the dismal saving rates weren’t fully explained by lack of caring. They also cited a combination of low resources and poor awareness: “The lack of preparedness is not signaled by a lack of planning alone. Many respondents, particularly those with limited incomes, indicated that they simply have few or no financial resources available for retirement.”

For many people, particularly those working part time or earning low wages, the biggest obstacle to a steady retirement savings plan is access. About three-fourths of private-sector workers with full-time jobs have access to a retirement plan, but that number drops to 37 percent for part-time workers, according to the Bureau of Labor Statistics.

So, what did workers say about covering expenses in retirement? The biggest resource people plan to rely on, whether or not they had savings, is Social Security, which was cited by roughly 45 percent of respondents.

Many people said they would just keep working: About one-third of those surveyed said they delayed their retirement after the financial crisis. Among those 45 and older, that rose to 41 percent.

Only 18 percent of people said they envisioned a traditional retirement, working full time until a particular date and then quitting work completely.

Comments

carlyt 9 months, 3 weeks ago

The best chance to retire on your terms is to start planning and saving/investing early in life, do it with every paycheck and take advantage of any opportunity to increase your nest egg (employer matching plans, catch up contributions when you reach 50,etc.). While this may be difficult for some, many others don’t think or prepare for retirement until they are almost there. I use several sites for retirement information including Dividendchannel, ETFchannel and Tthe site Retirement And Good Living which provides information on investing, planning, downsizing, frugal living. retirement locations and many other retirement topics that can help those who are planning for retirement or are already retired.

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