More Americans than you think have no retirement savings.
Most people want to retire eventually.
The sobering reality?
In retirement you still will need a source of income.
This means you will need to save money while you are still in the workforce.
According to a recent Think Advisor article titled “Most Americans Have $0 Saved for Retirement: NIRS,” most Americans apparently do not act on this fact of life.
You read that correctly.
This means most people have zero money saved for retirement.
Who are the worst offenders?
Of those who are ages 21 to 34, nearly 75 percent have nothing saved.
The age groups of 35 to 44, 45 to 54, and 55 to 64 tied with about 50 percent having no retirement account.
What qualifies as a retirement account according to the report?
These include employer sponsored accounts like 401(k)s, 403(b)s, 457(b)s, SEP IRAs, and simple IRAs.
It also includes private accounts like traditional IRAs or Roth IRAs.
Those with higher incomes were more likely to have a retirement account.
Are those with retirement accounts automatically set for retirement?
Many of these accounts contain an insufficient balance.
In fact, the average account balance for those ages 55 to 64 is $88,000.
This amount would only provide a few hundred dollars of income per month during retirement.
About 22 percent of individuals do not have the equivalent of a year of their salary saved.
How much is recommended for you to save for retirement, as a rule of thumb?
If you are retiring early, you should have 14 times your salary saved at age 62.
If you are retiring at age 67, you should have 10 times your salary saved.
These figures would allow you to have income payments until age 93.
Do not be like the rest of America.
Start saving now.
Work with an experienced financial advisor to help create a plan.
Reference: Think Advisor (September 18, 2018) “Most Americans Have $0 Saved for Retirement: NIRS”