CNN Money reported last week that 43% of Americans have less than $10,000 in retirement savings, which is a statistic provided by the Employee Benefit Research Institute in their Retirement Confidence Survey  (2010 results ). If that figure isn’t scary enough, it appears that 27% of workers have less than $1,000. Both figures are increases from 2009, when 39% had less than $10,000 and 20% had less than $1,000 a year ago.
While the statistics are sobering, it does show how much the recession has hurt a lot of people. If you lose your job, the first thing to go after your emergency fund is probably going to be your retirement savings. Keeping a roof over your head and food in your stomach is going to take precedence over retirement tomorrow.
If you dig a little deeper in the statistics, you get a little more color on the situation and it’s not a good one. 56% of workers between 25 and 34 have less than $10,000 in savings, 46% between 35-44, 38% between 45-54, and a mind boggling 29% of workers over 55 have less than ten grand in their retirement savings. (on the other side, it’s pretty amazing that 10% of workers between 25 and 34 have over $100,000 in retirement savings, so it’s not impossible, which totally blows away both my expectations and what we know about average retirement savings )
If you’re one of the ones with less than $10,000 in retirement savings, don’t despair because 43% of Americans are there with you. We’re going through some tough times now but once we get back on our feet, retirement savings has to become a priority. Social security and other entitlement programs aren’t going to be here forever. It’s only a matter of time before they are replaced as defined benefit (pension) retirement plans are being replaced with defined contribution (401k) retirement plans (Math doesn’t care which political party’s name is written on your voter card, the current system is not sustainable).
If you’re in better shape, excellent, congratulations but don’t pat yourself on the back just yet. Share your tips with your working friends so that we can come back in five years and talk about how great it was we reversed the trend. We’re not getting many incentives to save for the future, just look at CD rates  if you need a reminder, but that doesn’t mean we shouldn’t do it.
43% have less than $10k for retirement  [CNN Money]