Average American worker has less than $1,000 saved for retirement study says
Some people may not have enough money for retirement.
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As shown on Information Center 7 at 5:00 p.m.a recent study from the National Institute of Retirement Security shows that the average American worker has less than $1,000 saved for retirement.
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The nonprofit group says the typical American worker has about $950 saved for retirement.
News Center 7’s Nick Foley says the group includes employees ages 21 to 64.
It also shows a huge gap between what workers have put aside and what the retirement industry and advisors are recommending to people.
“About half of workers don’t participate in a plan at work,” Dan Doonan said. “We expect you to start saving at age 25 and do it every year for 40 years. It’s just not common.”
Doonan told Foley that with the cost of living higher than ever, it’s understandable that people might fall behind.
“Actually, it’s incredibly rare, but that’s what the pension industry says, as if that’s what you have to do,” he said. “There are real competing priorities that I think are putting pressure on other generations. »
Doonan says that while large private companies and public employers make it easier for employees to create a retirement plan, many workers don’t have access to a 401(k) plan.
Studies show that people save significantly more when an allocated amount is taken directly from their paycheck and deposited into a savings account.
“If it’s done automatically, you know, sign up, and it happens, instead of writing a check every month to save, that from a behavioral standpoint, it’s not a good plan,” Doonan said. “People won’t do it as much. So, yes, having a frictionless path to savings, I think, is extremely important.”
Foley says here in Ohio the state has many savings plans for public workers, police and firefighters.
There are also programs for potential home buyers and those saving for college.
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