Half of workers have less than $25,000 saved for retirement
At CNN/Money this morning I read a piece by Jeanne Sahadi about how almost half of all workers have saved less than $25,000 for retirement. As I said in my post about statistics, you have to watch the numbers, but they are horrific in this article. Here are some excerpts with my comments:
“Predictably, the youngest workers (ages 25-34) dominate this group - 68 percent of them have less than $25,000 earmarked for their later years. But so do half of workers age 35 to 44 and a third of workers age 45 to 55 and over.”
Oh, boy. If you are 55 and have no money saved for retirement, retirement is not an option for you. Get used to the idea. On the other end, young people are squandering the single biggest element in saving for anything - time. Compounding will do wonderful things to even a small investment.
“While financial pressures can play a big role in how much one saves, so, too, may your expectations: 30 percent of workers said they thought they would need to have a nest egg worth less than five times their current income to live in retirement, while 27 percent thought they needed between five and 10 times their income in savings.”
Sure, five times your salary will work great…if you plan on living for seven years after you quit working.
“Sixty-two percent surveyed said they expected to receive a pension when they retire, even though only 41 percent of them said they knew of a pension they or their spouse had coming.”
Does not compute. You know you have no pension, yet you expect a pension to be there when you retire? I don’t get it. Don’t even get me started about pensions. The short story is, unless you have less than 10 years until retirement, you aren’t getting one. I’m willing to bet less than 10% of people will have pensions within 15 years.
