Almost 42% of all Americans run the risk of retiring completely broke, according to a new study.
GoBankingRates conducted an online poll via Google Consumer Surveys that asked average Americans about the state of their savings and current retirement plans.
The poll surveyed Millennials, the middle aged and senior citizens. One question was, “By your best estimate, how much money do you have saved for retirement?”
About 42% of Americans said they have saved less than $10,000 in consideration of their retirement plans. Of them, 14% said they have saved absolutely nothing for their future retirement needs.
Most financial experts suggest having at least $1 million dollars saved for retirement.
There are many reasons why such a large percentage of Americans are woefully unprepared for the financial realities of retirement.
Among them are not making prudent investment planning decisions and engaging in unwise investments.
But income is a big reason, too. In response to the question “Which is the main reason you do not have any retirement savings?” more than 40% answered, “I don’t make enough money.”
More than 25% of those surveyed answered this question by saying, “I’m struggling to pay bills.”
Harder to attain
Meanwhile, life expectancies are longer than ever before for most Americans.
That fact, in addition to low incomes and low personal saving rates, has decimated the retirement dreams of many Americans.
Americans aged 65 and older required annual income sources of at least $46,000 to cover average living expenses, according to government data.
Although the recent study was dire news, the 42% percentage of Americans unprepared for retirement has actually shrunk in recent years.
The percentage of Americans with under $10,000 in retirement savings was 55% in 2017 and over 56% in 2016.
More Americans are saving more money, too. More than 16% of Americans have more than $300,000 saved, as opposed to only 14% in 2017 and just 13% in 2016.
Finance experts suggest that people save at least 10% to 15% of their annual income, cut inessential expenses and live somewhere with a lower cost of living in order to save enough for retirement.