Feeling behind on retirement saving? You're not alone
Nearly three-fifths of Americans in the workforce believe they’re behind where they should be when it comes to their retirement savings, according to a Bankrate (RATE) survey released Wednesday.
That’s 57% of Americans who are working full or part-time, or are temporarily unemployed — including 35% who think they are significantly behind their retirement needs, the survey said. This becomes even more acute the closer they get to retirement age, with Gen X workers feeling the most behind of all generations.
Bankrate commissioned YouGov Plc (YOU). to survey 1,279 working Americans between Aug. 19-21.
“A good number of these workers who feel or are behind on their savings are many years, or even decades away from traditional retirement age,” said Bankrate senior economic analyst Mark Hamrick. “Those who strive to prioritize retirement savings, as they should, have reason to believe they can achieve their goal. It takes information, focus and hard work, but the good news is that it can be done.”
The so-called “magic number” — how much U.S. adults believe that they’ll need for retirement — hit $1.46 million this year — a 53% jump from $951,000 in 2020, according to Northwestern Mutual.
To meet these needs, Americans are trying to stick to a consistent savings plan. In its survey, Bankrate found that, compared with last year, a majority of Americans in the workforce are contributing more or the same amount to their retirement accounts.
But when it comes to beliefs about whether they’ll have enough of a nest egg, those surveyed were about evenly split: 49% said they’re likely to be able to save as much as they’ll need for retirement, while 48% believe it’s not likely.
The average balance of a 401(k) was $127,100 in the second quarter of this year — still well below what most Americans believe they’ll need to retire comfortably, according to Fidelity Investment’s latest retirement analysis report. Meanwhile there were 497,000 401(k) millionaires in the quarter, up 2.5% for a third consecutive quarter of retirement savings growth.
Despite growing savings balances, the Social Security Administration has warned that the trust funds that some 66 million Americans rely on will be depleted in 2034, due to an overburdened social security system unable to keep up with the growing number of retirees and people living far longer than they used to.
This year, more than four million Americans will turn 65, the average retirement age — the largest wave of Americans reaching the retirement age in history, Northwestern Mutual said.
