Nearly 1 in 3 US Adults Have No Retirement Savings

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Many Americans are not prepared for retirement. While that may be no surprise to you, this might: One in 5 people who are nearing retirement age have no money saved.

That alarming statistic was highlighted in a recent report by the Federal Reserve Board on the economic well-being of U.S. households. According to a report press release:

Thirty-one percent of non-retired respondents reported having no retirement savings or pension, including 19 percent of those ages 55 to 64. Additionally, almost half of adults were not actively thinking about financial planning for retirement, with 24 percent saying they had given only a little thought to financial planning for their retirement and another 25 percent saying they had done no planning at all.

So why do so many Americans lack a retirement savings account? The survey found that many young people haven’t started saving for retirement yet. But it goes beyond that, the report said.

Part of the story also seems to be one of financial fragility for some households, who lack retirement savings and also have little financial cushion at all. Over half (54 percent) of those with incomes under $25,000 reported having no retirement savings or pension, compared with 10 percent of those earning $100,000 or more. Of those who reported that they had no retirement savings or pension, 67 percent also reported that they did not regularly set aside part of their income in some type of savings account, compared to 47 percent of the overall population.

The report also includes these retirement statistics:

  • Of those Americans close to retirement age (55 to 64), just 18 percent said they planned to work full time until a set retirement date, then not work again. About a quarter said they would work as long as possible. Another 18 percent said they anticipated retiring, then taking on a part-time job. And 9 percent said they’d retire and then work for themselves.
  • About two-fifths of Americans ages 45 and older who had not yet retired said the Great Recession pushed back their planned retirement date.
  • Nearly 3 in 4 retired people included Social Security benefits as one source of retirement funds. Another 44 percent cited defined benefit pension payments as retirement income. And 32 percent said they use savings outside a retirement account.

The Fed surveyed more than 4,000 working and retirement-age Americans.

Are you surprised that 31 percent of Americans have saved zilch for retirement? Share your thoughts below or on our Facebook page.

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Comments & discussion

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  • Harry

    The best chance to retire on your terms is to start planning and saving/investing early in life, do it with every paycheck and take advantage of any opportunity to increase your nest egg (employer matching plans, catch up contributions when you reach 50,etc.). While this may be difficult for some, many others don’t think or prepare for retirement until they are almost there. The recession had little to do with the reduction of retirement nest eggs of people who did not save. I recently found the site Retirement And Good Living which provides information on investing, planning, downsizing, frugal living. retirement locations and man other retirement topics that can help those who are planning for retirement or are already retired.

  • Barbara

    I grew up in a single-parent household. My dad left before I was born and never paid any child support. I never received any inheritance from anyone. I graduated from high school at the age of 17 and had to support myself ever since. I did not have the finances or grades to go to college when I was young. I was almost 27 when I married, and after having my children I was a stay-at-home-mom. My husband did not want me to work. He insisted he’d never leave me and that he’d always take care of me. After 25 years of marriage, he divorced me and did not pay me alimony. Even my vehicle was repossessed, because I could not make the payments. I supported our daughters for 4 years without child support, even had to collect welfare funds. I went to a post-secondary school to further my education, and they pushed students out the door before they finished their studies. Although they promised help with our job search, I did not get any. I’ve been drained financially, and my credit is poor. Searching for work at an older age is very difficult, especially when employers look you over for younger workers. After job searching for almost 2 years, I started collecting social security income after the age of 62. Discrimination still happens. It just seems hard to prove. I live in a one-bedroom apartment and have to rent the bedroom out to keep a roof over my head. Last year, a roommate moved out when I was not at home. He didn’t even pay his rent or utilities. My $600 savings was totally drained since I had to pay the full rent myself. Since then, I’ve had a struggle keeping up and still have no savings at all. Why are people judged for not having a savings when circumstances prevent that from happening? Most people have inheritances or relatives that can help them out. That is not my case. I have given to others all my life, and there’s nothing leftover for me.

  • Barbara

    Oh, I forgot to mention that I still have student loans that I cannot pay due to lack of funds. I am very low income.