This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

The Upside Of Retirement Worries





Are you worried about retirement? If so, that may be a good thing.

Those concerned they may not have enough money to retire comfortably have plenty of company today. A recent survey by the Pew Research Center found that 38 percent of Americans are not confident that they will be able to afford retirement.

Why could that level of worry be a good thing? Because savings rates in the U.S. have been deficient for a very long time, an increased level of worry might indicate a heightened awareness of the problem. That awareness could be the first step toward addressing the obstacles that future retirees face.

The sad state of retirement confidence

Certainly, the trends indicated by the survey show there is plenty of cause for concern. Here are some major points:

  1. Retirement confidence has taken a hit. The 38 percent who are not confident about being able to afford retirement is an increase from the 25 percent who responded that way in 2009. While the economy has ostensibly been in a recovery over those three years, many Americans continue to struggle, and perhaps they've just had more time to assess the damage that the financial crisis and the Great Recession did to their wealth.
  2. Asset declines are shocking. The Pew Research Center found that the median wealth of American households declined by 28 percent between 2001 and 2010. The damage was worst for people between ages 35 and 44: Median wealth in that age group declined by 56 percent.
  3. People in their late 30s are most worried. The severity of losses in that 35 to 44 age group may help explain why retirement worries are most prevalent among people of that age. The Pew Research Center found that 49 percent of those between 35 and 44 are not confident about being able to afford retirement, which is the highest level of doubt for any age group. What suggests there has been a growth in awareness of the problem is that just three years ago, this group was one of the most unconcerned about retirement funding, with just 20 percent expressing a lack of confidence at that time.
  4. Average incomes make retirement challenging. According to the Bureau of Labor Statistics, the average wage in the U.S. is $45,230. The Pew study found that in the $30,000 to $49,999 income bracket, lack of confidence in retirement funding jumps from the overall average of 38 percent up to 70 percent. In other words, Americans of average means are finding it extremely difficult to save enough for retirement.
  5. Too many people seem to be giving up. The stock market has been shaky over the past dozen years. Savings account interest rates are down near zero. In short, Americans aren't getting much return on their investments, but the other problem is that people seem to be abandoning their investment programs. The Pew study found that the proportion of households owning stocks fell by 6 percent between 2001 and 2010, and ownership of retirement accounts declined by 2 percent over the same time period.

While it's not enough just to worry about retirement, if it's the first step toward making a plan and improving savings rates, a little anxiety might prove to be constructive. Ultimately, you will likely find that the more action you take to secure your retirement, the less you'll have to worry.

null

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 18,030.21 +6.04 0.03%
S&P 500 2,081.88 -0.29 -0.01%
NASDAQ 4,773.4720 +8.0480 0.17%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs