Most workers who aren’t saving for retirement through their employers aren’t saving at all, the study found
New data suggests the average American worker has under $1,000 saved for retirement.
A report from the National Institute on Retirement Security found that the median savings for all employed adults between the ages of 21 and 64 were approximately $955. The study includes workers with 401(k) and other retirement savings plans, as well as the approximately 56 million workers who do not have access to employer-sponsored retirement plans.
Workers with retirement savings plans have a median balance of approximately $40,000 saved, according to the report. That figure is nowhere near the $1.5 million that Americans say they need to feel comfortable fully retiring.
Lots of people saying it’s a skill issue that people aren’t saving more of their earnings. The problem is much deeper: it doesn’t make sense for the majority of Americans to save their money. This is the rational outcome of a political and economic system that does not offer hope, only cynicism.
If it was a handful of people, it could MAYBE be a skill issue. But when it’s most people, it’s a systemic issue.
I had an argument about that with the college when I failed ochem. 2/3 of the students failed ochem that year. My argument was basically they made the tests too hard just to weed people out because I aced the lab class and always had As on my papers. Papers where you performed real world calculations not insane ones. There reply was basically yeah its a weed out class take it again or switch majors but we’ll let you keep your scholarship… for now. Kept major, switched schools a year later then switched majors.
I had several 401ks, I cashed them out fairly quickly because an emergency would come along and it was the only thing between me and homelessness, or not receiving medical care.
Now I have a 403(b) because I work for higher ed, and I am forbidden to cash it out, but I’ve taken a loan against it and paid off my credit cards, and am paying myself interest now.
So now I have my CCs freed up for the next time I have an emergency, which will be checks watch
I had almost completely strip-mined my 401k and post-tax investments by the time I was 56 due to a family member’s mental-health crisis and the downstream impact of that (it was worth it: the family member in question is now stable and thriving). I’m now 70 and should be able to retire next year if some other emegency doesn’t bite us on the ass before then. It took 14 years to rebuild, and that was with my wife and me both bringing in professional salaries and having additional investments.
I feel the “checking watch for next emergency”
I’m just about done paying off my last emergency so I’m right on time for the next big one. Fate seems to wait until I’m spitting distance from paying it off to taunt me or some shit.
The last time I was literally 1 month from having it paid off before BOOM $10k medical emergency and to not become homeless due to said medical emergency combined with being on FMLA for 12 weeks minus a day.
It don’t like like a lot to some but for me it’s been hell.
I’m not from USA so I don’t know what rates of interest your banks offer, but most here offer less than 4%, so there doesn’t seem much point for a few hundred quid.
In the retirement account front, just checked and for the past year it hit 19%, over the last 10 years, it’s been 15% a year. Generally those are biased toward stock and move to more conservative close to retirement. I think that’s generally the balance being considered, at least if you have any retirement account, it’s probably later than any other account in short order.
For “savings” account recently 4% has been available, but less so now as the central bank turns down interest rates to favor borrowers again. But I don’t think they are limiting to strict savings accounts here. I think money put into an index fund or bonds or CDs would absolutely count.
Most private workplaces offer retirement investment accounts, that seems to be more what they mean.