Data and Research

Americans Unlikely To Save More for Retirement in 2017

Even though saving for retirement is America’s top financial concern, only 32% of people plan to increase contributions to their retirement accounts in 2017, according to the latest research by NerdWallet. 

By Javier Simon | December 13, 2016
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Moving into the New Year, Americans’ prospects for a comfortable retirement are not looking too bright. A year-end report by NerdWallet finds that only 29% of respondents reported feeling confident that they saved enough for retirement this year. Nearly one in three aren’t saving at all.

The survey also revealed major anxiety over lack of savings, and other financial obligations that may be forcing retirement savings to take a back seat. The top financial concerns are health care bills and expenses (35%), lack of emergency savings (35%), lack of retirement savings (28%) and credit card debt (27%).

Not surprisingly, the Centers for Medicare & Medicaid Services predict health care spending to increase at an average of 5.8% per year between 2015 and 2025, and the U.S Department of Health and Human Services projects per-person cost in 2016 to top $10,000 for the first time. Moreover, NerdWallet’s analysis found that credit card debt averages at $16,060 and has increased 11% in the last decade.

“Every dollar Americans have to put toward health care, debt and other expenses is a dollar that isn’t saved for retirement,” says Kyle Ramsay, CFA, head of investing and retirement for NerdWallet. “This struggle to keep up with competing financial priorities is part of why Americans of all ages are falling behind in their retirement savings goals.”

And 2017 may not be any better for nest eggs. Of the 70% of people saving for retirement, only 32% plan to increase contributions into their work place retirement accounts.

The survey results also offered some interesting insight into how different generations approach retirement planning. Those between ages 45 and 54 were the most likely to be concerned about retirement saving. Of these individuals, only 20% reported feeling confident that they saved enough this year. Forty-three percent of Millennials, defined in the study as those between ages 18 and 34, are not saving for retirement at all. This is true for 30% of all respondents.

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