Half (49%) of Americans planning for retirement say they are behind where they need to be to retire at their ideal retirement age, according to today’s latest edition of the MassMutual Consumer Spending & Saving Index.
The survey found more men (52%) report being behind on retirement savings than women (44%). Nearly half say they are not saving enough for retirement at their ideal age (45% Gen Z and 53% Millennials). One in five (20%) non-retired Americans surveyed said do not ever plan to retire.
Among those that have already retired, 43% say that their retirement savings are about what they need to be, while 21% say that they have more than they need and 29% say they have less than they need.
“Investing in yourself through wise financial choices today is a commitment younger people can make to securing a financially free and more stable future,” said Paul LaPiana, head of MassMutual brand, product and affiliated distribution. “As with most healthy habits, consistency is key. Good financial habits include saving and spending responsibly, increasing retirement contributions and broadening your investment portfolio to unlock a financially secure and prosperous future.”
The survey also found most younger Americans believe financial stability is a stronger determinant of personal happiness than the person they marry. Older Americans do not agree (Gen Z 65%, Millennials 62% vs. Baby Boomers 41% and the Silent Generation 29%), suggesting a shift in evolving priorities among younger generations, who value economic security and self-sufficiency over strong and enduring relationships.
Student loan payment restart will impact spending
Over a third of Americans with student loan debt report using funds earmarked to pay down their debt to purchase consumer goods during the pause in federal student loan payments.
The survey found 74% of Americans with student loan debt are planning to cut back on their spending when student loan payments resume. Over a quarter of those cutting back plan to buy fewer luxuries (27%) while 47% are intending to reduce spending on essentials.
A majority of Americans with student loan debt said that they are somewhat or very concerned about the impact of the resumption of federal student loan payments on their finances (80%).
Looking toward 2024
Peering into 2024, Americans are slightly less concerned about a recession and have mixed feelings about how the U.S. political climate and 2024 presidential election will impact their finances.
Those surveyed expressed a slightly reduced level of concern about a recession compared to last quarter (77% Q3 2023 vs. 81% Q2 2023). Based on this data, Americans are now equally as concerned about a recession as they are about the U.S. political climate (78%). The upcoming 2024 presidential election also looms large in the collective consciousness, with 75% of Americans expressing anxiety over how the result will impact their finances.
Finally, Americans may also be tightening their budgets this holiday season, with 80% of those surveyed expecting to spend either the same amount or less than they did last year.
“The most recent findings from MassMutual’s Consumer Spending & Saving Index highlight the resolve of the American consumer to build a resilient financial future for themselves and their loved ones despite collective anxiety about anticipated political and macroeconomic headwinds,” LaPiana said. “By adapting to evolving market and political trends, including an upcoming presidential election and an evolving global economic landscape, Americans can weather any financial uncertainty that heads our way.”
SEE ALSO:
• Competing ‘Financial Vortex’ Challenges Retirement Savings
• Borrowers Increasingly Stressed Over Looming Student Loan Payments
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
