As more American workers look forward to a phased retirement, it’s no surprise that a higher number have saved little to nothing for their long-term future so far.
The latest GOBankingRates survey of more than 1,000 U.S. adults reports that 28% of workers ages 18 to 24 have zero retirement savings, while 39% are not currently contributing to a retirement fund and another 30% do not think they’ll be able to retire at all.
GOBankingRates notes a disconnect between what participants believe they’ll need in retirement versus the amount they’ve already saved. A quarter of respondents say they can retire with less than $500,000 and another quarter believe they’ll need between half a million to a million dollars. Thirty percent of workers even anticipate requiring up to seven figures to fund their retirement. This is as nearly 23% say they’ll be able to retire early and another 24% believe they can retire by age 65.
While expectations are high, only 10% have a retirement nest-egg of $50,000 to $100,000, and 33% have less than $50,000. Those between the ages of 18 to 64 aren’t faring much better—between 25% and 35% of all age groups have nothing saved so far for retirement.
As a result, some age groups are moving quickly to begin saving. According to the findings, 16% of 18 to 24-year-olds put 4% to 6% of their incomes in a tax-advantaged retirement account, more than any other age demographic. Eight percent of Gen Z participants allocate 7% to 9% and one in ten are adding 10% of each paycheck to a retirement account.
The finding echoes a similar point in Fidelity’s newest State of Retirement Planning report, which found that Gen Z workers started saving for their retirement at age 20. Still, Fidelity’s report adds that more are wishing having started even earlier.
However, participants later into the careers won’t have the investment growth that comes with saving for several decades, GOBankingRates reports. Ultimately, the survey urges respondents to begin their retirement savings now rather than later, underlining a “something-is-better-than-nothing” attitude, while inquiring upon the help of a financial advisor.
SEE ALSO:
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- Inflation and Unemployment Decline While Account Balances Grow: Vanguard
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.