Most Americans face persistent challenges of saving for retirement, new survey reveals

RETIREMENT ADVICE—This couple discusses their retirement plans with a financial advisor.

A new survey by the Employee Benefit Research Institute reveals that while many Americans remain optimistic about their retirement years, they face significant hurdles when it comes to saving for retirement. 

A striking finding from the survey is that most retired workers identify Social Security as their primary source of income, underscoring the widespread struggle with building sufficient retirement savings.

Teresa Ghilarducci, a professor at the New School for Social Research in New York, shed light on the enduring issues that Americans encounter as they plan for their retirement. “Half of people don’t have retirement accounts at work. And that’s been true for decades. So it’s not getting any better,” Ghilarducci told TheStreet.

She emphasized that saving for retirement remains the most significant challenge. “But it’s close. It’s followed very closely by having to decide where to invest. That’s followed closely by if you accumulate even $1 million, how to manage it. The challenges are simple: accumulation and investment. It’s the whole package, the do-it-yourself package, that is the biggest barrier to people’s retirement.”

Ghilarducci pointed out that this retirement planning dilemma is uniquely American. “There’s no other country that does it this way that requires so much acumen, discipline, and anxiety from its workers than the United States,” she said. This system places a heavy burden on individuals to navigate complex financial decisions with minimal support.

The professor also criticized the role of employers in exacerbating this issue. She cited Amazon as an example, noting that the company has a business model that keeps warehouse workers for only six or seven months. “People are gig workers, contingent workers, and dependent workers,” Ghilarducci added, highlighting the instability and lack of benefits that come with such employment arrangements.

Despite these challenges, Ghilarducci offered a potential solution to improve the outlook for Americans. She proposed integrating retirement savings more seamlessly with Social Security contributions. “Almost everybody pays into Social Security,” Ghilarducci said. “So if we just had a system where for every Social Security credit earned, there was also a financial credit in a retirement account, we could solve the problem.”

She added: “Right now, we rely on employers voluntarily sponsoring a 401(k), and then that’s not enough. And then the worker has to voluntarily decide to be in the 401(k), so it’s two decisions.” 

While Americans are hopeful about their retirement, the path to achieving financial security in their golden years is fraught with challenges. From the lack of workplace retirement accounts to the complexity of investment decisions, the current system demands a level of financial literacy and discipline that many find daunting. 



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