We’re surprised it’s only 52%.
A new national poll from Bankrate.com finds that more than half of American workers (52%) think they’re behind in saving for retirement.
Just 16% say they are right on track, and 11% feel they are ahead of where they should be in terms of saving. Another 20% of respondents say they don’t know if they’re on track or not.
The tendency to be behind on retirement savings is highest among households with an annual income between $30,000 and $49,999, with 62% responding that they are behind where they should be.
This compares with 52% for households earning an income under $30,000 and 48% for households with income of $80,000 or more.
What’s concerning is the fact that those getting closer to retirement age aren’t prepared; 57% of younger boomers and 63% of Generation X say they are behind on retirement savings.
Shockingly, 38% of U.S. workers have never had a retirement account, including 36% of those in Gen X and 58% of those households with annual income below $30,000.
Unforced errors
Although financial experts routinely warn against the practice, nearly half of those with retirement accounts have withdrawn money before retirement age.
The most common reasons for tapping retirement savings early are unemployment (33%), medical bills or other unplanned expenses (26%), and debt repayment (23%).
Additionally, 17% dipped into retirement savings to purchase a home, and 12% made an early withdrawal to cover higher education expenses.
The retirement setback from early withdrawals is noticeable by respondents who have done so; 61% are behind where they should be on retirement savings, and just 18% say they are ahead of where they should be. Among those on track for retirement, only 31% have taken an early withdrawal compared to 52% that are behind.
Setting goals appears to have an impact on success in retirement savings.
Of those that feel they are ahead of where they should be on retirement savings, 71% have a specific amount of retirement savings they’re working to accumulate compared to 45% of those that are right on track and 26% of those that are behind.
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
