More Americans Report Having 401k Savings, But Few Are Saving Enough

As it stands, many are at risk of going broke in retirement

401k, financial wellness, retirement savings, gobankingratesWhen almost doesn't count.

Some good news and bad.

Let’s start with the good. Far fewer Americans this year report having zero dollars saved for retirement, according to an annual survey by GOBankingRates. Just 13.7 percent have yet to save a thing, a drastic improvement from 33 percent with zero savings in 2016 and 34 percent in 2017.

What’s better, the 2018 Retirement Savings assessment shows 16 percent of Americans have $300,000 or more saved; 10 percent have $200,000 to $299,999; and 12 percent have $100,000 to $199,999. Twenty percent of survey respondents report having somewhere between $10,000 and $100,000 in their nest egg so far.

In sum, the majority of average U.S. adults have tucked away at least $10k for retirement. This is a great start.

However, it still leaves a lot to be desired. Here’s the bad news: 42 percent of those surveyed report a retirement account balance of $10,000 or less.

“If they don’t boost their savings, they’ll likely retire broke because that’s not enough to cover a year’s worth of expenses. On average, adults 65 and older spend almost $46,000 a year, according to the Bureau of Labor Statistics,” GOBankingRates explains in its report.

So, what gives? GOBankingRates dug deeper in a separate study focusing exclusively on adults who have saved nil.

Reasons for not saving included:

  • I don’t make enough money (40.1 percent)
  • I’m struggling to pay bills (24.9 percent)
  • I won’t need retirement savings (10.3 percent)
  • I used my retirement savings for an emergency (9.9 percent)
  • My job doesn’t offer a retirement plan (9.2 percent)
  • I’m prioritizing paying down debt (5.7 percent)

For those approaching retirement age, there’s a glimmer of hope on the horizon as “adults 55 and over…have the highest percentage of respondents who have saved $300,000 or more—23 percent.”

But for others, retirement appears bleak.

“About one-third have less than $10,000 saved. That means these baby boomers need to catch up on retirement savings if they won’t have other sources of retirement income beyond Social Security,” GOBankingRates concludes.

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