That is what retirement used to be called. But that was when many people had pensions and health care. Concepts that have already been consigned to the history books for the majority.
The good news, we suppose, is that the number of Americans not saving anything for retirement is still below 50%.
The problem is not that they do not want to but that they can not put money aside. Several decades of offshoring jobs, reduced benefits and declining public sector employment have led to declining household incomes. If people can not pay the mortgage or are deferring health care expenditures in order to make current ends meet they are unlikely to be able to save for retirement. In fact, retirement itself may become illusory. It is not clear what all those people will do, but the increasing numbers working in the fast food industry, with its 100%+ turnover rates, suggests what the outcome may be.
From a public policy perspective, this may be a case of self-fulfilling prophecies. If those ideologically opposed to government programs make it impossible for people to contribute to them by promoting austerity policies that reduce their ability to do so, it will, by definition, make it harder for current sums to meet future needs.
At the same time, short of societally-sanctioned mass starvation, it is hard to imagine the demand for such programs decreasing. Which suggests that at some point ideology and reality are going to have to kiss and make up. JL
Blake Ellis reports in CNNMoney:
America has a serious problem saving for retirement.
About 49% of Americans say they aren't contributing to any retirement plan, according to a new survey conducted by LIMRA, a trade association for the financial services industry
"The findings from this survey were disturbing, given that people will increasingly need to rely on their personal savings to make ends meet in retirement," said Matthew Drinkwater, associate managing director at LIMRA's retirement research division.
People ages 18 to 34 are the least likely to be saving, with 56% reporting that they are not currently contributing to a retirement plan like an IRA or a 401(k).
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"In order to have the adequate savings necessary to meet their financial needs in retirement -- which could last 20 or more years -- it is critical that these individuals begin saving systematically early in their working years," Drinkwater said.
Nearly half of consumers said they aren't planning to contribute to an IRA because they can't afford to, and only a quarter of Americans have worked with a financial professional to plan for retirement, the survey found.
The study was conducted in April, and LIMRA surveyed 2,697 Americans
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