And only 22% of those polled indicated they believed they would have enough money after they retired to live comfortably.
Americans worry that they won’t be able to save the $1.1 million they typically need for retirement.
Less than one in four workers believe they can save that much money by the time they retire, according to a recent survey by Schroders, a U.K.-based investment management.
1,000 investors between the ages of 45 and 75 participated in the study in February, and their median family income was $75,000 at the time.
Only 22% of respondents said that they believe they will have enough money after they retire to live comfortably.
26% of respondents indicated that they would have enough funds in 2021.
The majority of respondents claimed they would not be able to save the $1 million target; just 56% estimated they could save less than $500,000, and another 36% thought they could save less than $250,000.
Among Americans, only 24% believe they will be able to save $1 million for retirement.
More than half, or 54%, of those aged 60 to 67 stated they would have savings of less than $250,000.
About 57% of individuals who had previously retired reported having less than $250,000 saved up.
Savings: Is it the solution?
More workers may start saving more now if they are concerned about not having enough money for retirement.
TheStreet was informed by Greg McBride, chief financial analyst at Bankrate, a New York-based provider of financial data, that this would take place soon.
“Most workers don’t save enough for retirement, and many may be motivated to boost their savings rates if they believe they won’t have enough saved when they retire, “added he.
“This is crucial for younger employees who, while simultaneously having the longest time to develop and compound their assets, will also have longer lifespans, higher medical expenses, greater Social Security uncertainty, and smaller pensions than generations before them.
Analyzing the Data
A closer look at the study’s data revealed higher anxiety around retirement.
Only 3% of retirees claimed to be “living the dream,” while 37% claimed to be content and another 37% described their feelings as “not great, nor horrible.”
The remaining retirees face challenges; 18% are having difficulty, and 5% are “living the nightmare.”
Spending more money on expenses is a significant problem for retirees.
Only 8% of those indicated expenses were less, compared to 44% who said they were greater than expected.
The top four retirement worries that employees have are how inflation will affect their savings, rising healthcare costs, a market downturn that would deplete their retirement savings, and health troubles that will deplete their savings.
According to Joel Schiffman, head of intermediary distribution at Schroders in North America, “these are truly hard times and they seem to be taking a toll on the American worker and their belief about obtaining a decent retirement.”
Inflation is currently Americans’ top retirement worry, but he said that things could change in the following year.
69 percent of Americans intend to continue working after retirement.
This is due to the fact that 56% of Americans, or more than half, require the money to cover living expenses.
Of those, 51% want to continue working, and 49% want to keep moving and staying healthy.
How to Save More Money for Consumers
Workers should rely less on Social Security benefits and instead save more money on their own through 401(k) and IRA plans, according to McBride.
“Start saving early and often, “added him. “Even those who are getting close to retirement age can take measures to improve their situation once they leave the employment, such as using catch-up payments to tax-advantaged retirement savings accounts, working a little bit longer, and postponing Social Security.
Experts advised consumers to put conserving money ahead of a goal they need to achieve that is decades away.
Priorities are crucial, according to Henry Yoshida, CEO of Rocket Dollar, an Austin, Texas-based provider of self-directed individual retirement accounts.
As with all significant, long-term objectives, he advised concentrating on starting in the here and now rather than becoming unduly preoccupied with the ultimate objective.
It will eventually become a habit to start saving even tiny sums for retirement, he claimed.
Even if you can simply save $100 to $150 a month to begin with, it will start to make a dent in the longer-term ultimate objective of a safe retirement.
How to Begin Investing
It might be difficult to get a savings plan off the ground.
Yoshida added, “Starting is sometimes the hardest part, therefore I constantly advise folks to just get started, no matter how little the sum may be.
Robert Johnson, a finance professor at Creighton University, told TheStreet that people should give saving money for retirement a higher priority when they are still young. They can accomplish this goal by making a budget.
He claimed that “a major issue with many folks is that they just fail to budget.”
“A budget is essential. In particular, one should budget for retirement funds rather than just tracking spending.”
Warren Buffett, CEO of Berkshire Hathaway, has also provided counsel in the past.
“Look at your budget if you want to make saving a priority “said he. “Spend what remains after spending rather than save what remains.
According to Johnson, you should include a line item in your budget for the amount going toward a retirement account.
He declared, “You don’t successfully grow money by just taking what’s left after all your expenses. “What we prioritize, we achieve. Set aside money for investments first and then.”
It’s a mistake to rely on Social Security benefits to fill in the income gap.
According to Johnson, “I think there is a misperception among many Americans that Social Security will cover their retirement.”
They don’t realize the low standard of living that comes with relying entirely on Social Security, according to the statement.
