The Charles Schwab IRA survey found a majority (89%) of Americans age 25-40 admit to having at least one major financial concern regarding retirement, yet nearly four out of every five (78%) say, for now, retirement planning takes a back seat to financial priorities such as meeting daily expenses, paying off debt, or buying a home. Only 27% of respondents consider saving for retirement to be a priority, according to a press release on the survey results.
Only 13% of GenXers surveyed feel strongly that they are on the right track for retirement and know exactly what they need to do to prepare. The survey found 53% of those saving for retirement are doing so in an employer plan such as a 401(k), and only 24% are funding individual retirement accounts (IRA).
Other methods of retirement savings cited by respondents included savings accounts (62%) or direct investment in stocks, bonds, and mutual funds (30%) — methods which do not provide the same mix of growth potential and tax efficiency, Charles Schwab noted in the release.
About half (51%) of respondents without an IRA agree with the notion they pale in comparison to their peers when it comes to their understanding of IRAs and believe that they are less prepared for retirement. Only 10% of those with an IRA agreed with that comment.
Nearly nine out of 10 respondents with an IRA say they wish they had opened their account earlier in life.