A recent survey by Country Financial Security Index found one in four Americans across all age groups, admit they are not saving at all for retirement. Let me repeat that: They have saved nothing for retirement. Zero
47% of those 40 and older say they regret they did not start saving for retirement early enough. 46% say it’s not possible for a typical middle-income family to save for a secure retirement. This is two points higher than last year and the highest in three years.
Of those who are savings 29% say a 401k is the primary way of savings. Of the 45% who have 401k’s, 30% don’t know what they are invested in the other 55% don’t have a 401k or don’t know if they do. Not surprisingly 32% of those ages 18-29 are not saving for retirement or are not sure if they are. This is more than any other group.
The Country Financial Security Index survey did not address the amount that is being saved, but An April 1, 2014 USA TODAY story, reported that 36% of workers have saved less than $1,000 for retirement and 60% have put away less than $25,000 in retirement accounts. Less than 80% have saved $250,000 or more. About 44% of those surveyed have tried to calculate the amount they will need in retirement. At the commonly use 4% withdraw rate, a retirement saving of $250,000 would result in a retirement income of $10,000 a year, which is nearly $2000 below the single person 2014 poverty level in the USA.
Mark Fried, president of TFG Wealth Management in Newtown, PA referred to the lack of retirement saving as a “retirement crisis” which we will be facing for the next 20 years.
If you have questions about retirement planning such as; How much you should be saving, Which IRA is best for me: Traditional or Roth, When can I retire, we encourage you to contact us. Would are happy to assist you with any questions you may have.