Most Americans Saving for Retirement, But Many Don’t Know How Much They’ve Saved

State of retirement preparedness

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Two-thirds of Americans (67%) have at least some money invested in retirement accounts, but close to one in four don’t know how much they’ve saved, according to a State of Financial Preparedness Report released today by the TIAA Institute.

That’s true for 24% of retirees and 22% of those planning to retire according to the report, focused on how people of all ages, races, genders and ethnicities manage their daily expenses while saving for retirement.

Graphic credit: TIAA Institute

More than seven in 10 whites (76%) and Asian Americans/Pacific Islanders (71%) have retirement accounts, but that’s true for only about half of Black (49%) and Hispanic (52%) Americans. Many Hispanic (37%) and Black Americans (28%) who have not yet retired are unsure of how much they have saved, underscoring the significance of the uncertainty.

The research found that large majorities of people across all races and ethnicities spend time thinking about retirement savings—how much money they’ll need to save and how long it will take to do that. That’s true for 68% of Americans who are planning to retire, including 70% of Hispanic Americans, along with 68% of whites, 66% of Black Americans and 59% of Asian Americans/Pacific Islanders.

But while each group considers those calculations, underscoring the importance of preparing for retirement, the report highlights stark differences in how many people have saved, how much they’ve saved and how confident they are moving forward.

“We hope this research deeply informs the efforts underway to address our nation’s retirement crisis and spurs the actions needed to retire the financial and retirement inequality that too many people face,” said Surya Kolluri, head of the TIAA Institute.

“We’ve long talked about retiring inequality, but this new data does more to identify gaps, challenges and opportunities,” Kolluri added. “If most people are planning for retirement but can’t follow their plans, that’s a call to action for employers, policymakers, financial advisors, retirement services providers and others.”

The report comes at a time when life expectancy has risen by 17 years since the Social Security program debuted in 1935 – meaning people could have longer retirements—but 40% of U.S. households already risk running short of money in retirement.

More key takeaways:

“While we see progress in some areas, we will continue to provide deeper insight on many of the demographics that make America diverse,” Kolluri said. “That granular data will give fresh perspective, allowing people—employers, employees, policymakers, advisors, and others—to better identify the steps we must take.”

The TIAA Institute is a think-tank within TIAA, conducting research in the areas of financial literacy and longevity literacy, lifetime income, retirement plan design and behavioral finance in the context of retirement.

The full State of Financial Preparedness Report can be found HERE.

SEE ALSO:

• TIAA and Wyclef Jean Release Song Addressing Retirement Disparities

• How Different Demographics Tackle Retirement Readiness

• 4 Retirement Initiatives Vital to Closing the Racial Wealth Gap

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