Many people recognize that they could increase their retirement savings simply by cutting back on nonessentials but they find even that a hard thing to accomplish, according to the Employee Benefit Research Institute.
As part of its annual retirement confidence survey, EBRI gathered statistics showing that two-thirds of workers report that they and/or their spouses have money saved specifically for retirement, commonly through an IRA and/or a work-sponsored retirement savings plan comparable to the TSP.
However, in many cases those savings would not go far toward providing for retirement financial security: 57 percent said those savings are below $25,000, including 28 percent who say they have saved less than $1,000.
Of those polled, 69 percent said they could save $25 a week more than they currently are saving, with almost half of those saying they would cut back on eating out or take-out food. Other items they believe they could give up to accomplish that goal include soft drinks and snacks from vending machines, movies, coffee from specialty shops, and lottery tickets. About a quarter said they would not need to give up anything to save $25 more a week.
Said the report: “But if they can save more, why aren’t they doing so? Half—50 percent—say they simply can’t afford it due to the cost of living and the press of day-to-day expenses.” Commonly cited reasons include need to pay housing expenses and educational expenses.
It added that as in past years, slightly less than half of respondents have even tried to figure out how much money they would need to live comfortably in retirement.
