Are You Saving Enough for Your Retirement? Survey Says: No
A hot topic in the political arena is that of social security. Experts worry that the system has a critical flaw, and in a few decades, it will fail. This would leave a large portion of the population without a retirement plan.
You may have a 401K, a pension, or some other plan you pay into, but is it enough? Many experts say it is not. Retirement savings are something we should all be looking at starting as soon as we enter the workforce.
A large portion of the population is without a retirement plan
It has long been recommended that people set aside a minimum of 10% of their salary for retirement. Many don't, and those who do don't always make the best choices of where to put the money.
Let's look at the numbers around retirement savings, a few problems that people face, as well as some possible strategies to get you on track for a stable retirement.
What Are the Statistics?
Recent polls and studies show that most Americans aren't saving enough. Out of those surveyed around 20% are only saving 5% of their income, 28% reported saving between 6 to 10%, and just 16% saying they save 15% or more of their income.
What is more, it is the younger demographics that are doing the majority of the savings. With the cost of living in a seemingly endless climb, it is more important than ever to be successfully saving if you want a comfortable retirement at 65.
The numbers show that most Americans will not be financially stable for retirement, meaning they may need to rely on social security at some point. A distressing situation when many believe the program is doomed to fail.
It’s important to be successfully saving if you want a comfortable retirement at 65
The Problems with Retirement
As mentioned previously, the cost of living is always increasing. Insurance rates, food costs, gas prices, and utility bills are always costing more over time. While it was once enough to have a decent pension or a healthy 401K, this may no longer be the case.
It is more crucial than ever to save more for your retirement and diversify your savings to guarantee a worry-free retirement. Inflation is a key concern everyone should worry about when setting up their retirement strategy.
Another consideration may be planning for a move when mobility issues arise or possibly long-term medical care. It is always recommended that you talk to a financial advisor early about retirement savings.
What Can You Do to Get Ahead?
The key to good retirement savings is diversifying your portfolio. Investing in a long-term retirement plan is essential. For example, you should pay into your 401K and never touch that money until you are ready to retire. Outside of traditional retirement savings accounts, you may want to consider investing early into other plans.
Be sure you are saving at least 10% to 20% of your income and spread it over different savings and investment opportunities. Do your research and set aside a percentage of your income for investments. A few possibilities are swing trading strategies and real estate investment trusts.
Inflation is a key concern for everyone when setting up their retirement strategy
Retirement may not always be at the forefront of most people's minds, but it should be. Most Americans aren't saving enough for their retirement, and the numbers suggest you may not be either. It is probably time that you consider a better strategy for your future. Talk to a financial advisor to make sure you are following the best course of action for you.
This article does not necessarily reflect the opinions of the editors or management of EconoTimes.