More Than 4 in 10 Workers Not Saving for Retirement

 

A growing number of American workers are financially unprepared for retirement — and few feel confident that Social Security will provide them with the benefits retirees enjoy today.

The Employee Benefit Research Institute’s 2013 Retirement Confidence Survey found that 57 percent of workers have less than $25,000 in total household savings and investments, not including the value of their primary residence, up from 49 percent in 2008. And 28 percent have less than a paltry $1,000.

Only 66 percent of workers have saved any money at all for retirement, and just 24 percent of those earning less than $35,000 in household income have saved for their later years. Even worse, just 57 percent of workers — defined as those who are not retired even if they’re not employed — are currently saving money for retirement.

The survey also disclosed this troubling fact: Only half of workers say they could “definitely” come up with $2,000 if an unexpected need arose within the next month; 20 percent “probably could”; but 12 percent “probably could not” and 16 percent “definitely could not.”

It’s not surprising, then, that 28 percent of workers are “not at all confident” that they will have enough money for a comfortable retirement, the highest level in the survey’s 23-year history. Another 21 percent are “not too confident.” Just 13 percent are “very confident.”

The survey also disclosed:

  • Only 5 percent of workers are very confident that Social Security will continue to provide benefits of at least equal value to benefits received by retirees today; 41 percent are not at all confident.
  • Similarly, just 6 percent of workers are very confident that Medicare will continue to provide today’s benefits, and 37 percent are not at all confident.
  • 18 percent of workers decline to contribute to employer-sponsored retirement savings plans. The cost of living and day-to-day expenses are the reasons most cited for not contributing.
  • More than half of workers report having a problem with their level of debt, and 16 percent say it is a “major problem.”
  • 52 percent of workers are not at all confident or not too confident they will have enough money to pay for medical expenses in retirement, and 62 percent are not confident they will have enough for long-term care.

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