A frightening one in three Americans saved $0 for retirement in the past year according to the May 2020 Simplywise Retirement Confidence Index.
Women saved even less than men; 37% of women saved $0 (vs. 25% of men), and 50% of women participating in the survey saved less than $500 for retirement. Fewer than one in 10 women (9%) socked away more than $10,000 for retirement in the past year compared to 17% of men [see chart below].
Of those recently furloughed or let go due to coronavirus, 50% have saved less than $500 for retirement in the last year, and 70% have saved less than $1000.
Simplywise, which aims to simplify Social Security retirement benefits for consumers, conducted the survey of 1,070 Americans ages 18+ in early May, 2020, exploring how people are looking at retirement, Social Security, and savings today. The findings unearthed plenty of other scary retirement savings attitudes and statistics.
For example:
- One in five people believe it’s likely they will draw from their 401k for cash right now, including one in three of those who have lost jobs.
- 56% of Americans are more concerned about retirement today compared to how they were feeling about it a year ago. And 69% of people in their 50s—nearest to retirement—are more concerned about retirement today. Main concerns include fear that the Social Security trust fund will dry up before or during retirement (which 56% believe) as well as outliving savings during retirement (which 49% believe is likely). Covering everyday expenses (44%) and health care costs (43%) were the next biggest concerns.
- 40% of respondents said they are now concerned they won’t be able to retire at all. Given the current economic climate, 26% said they would postpone retirement altogether.
- 67% of working people surveyed plan to continue working in retirement.
- Of respondents in their 50s and 60s, 33% are now planning to claim their Social Security retirement benefits early. Over half of respondents believe their quality of life with suffer after claiming Social Security.
“For those who are eligible but not yet on Social Security, while we don’t necessarily recommend taking benefits earlier, this is a good time to consider how to maximize your benefits,” says Simplywise CEO Sam Abbas, in a blog post revealing the survey results. “That means understanding and calculating your options for earned benefits, spousal benefits and survivor benefits.”
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