A third of U.S. workers retire late, lack savings
BOSTON (Reuters) – A third of workers in the United States
are having to push back retirement because they either did not
save enough to live out their golden years or started too late,
Fidelity Investments said on Wednesday.
In a national survey of 1,900 workers aged 25 and older,
the No. 1 mutual fund firm and a big player in the retirement
industry, found that more than half of those who have had to
postpone retirement have done so because they did not save
Another 35 percent said they had started saving too late in
life and about the same number had to keep working to hold on
to employer paid health benefits.
About one quarter said their delayed retirement was caused
by poor investment decisions or market fluctuations that caused
a shortage of money.
“Too many people are delaying their retirement dreams for
lack of planning and adequate savings,” said Jeff Carney,
president of Fidelity Personal Investments.
Fidelity, which has taken a lead in retirement investments,
has long said as others in the financial services industry that
Americans were not putting enough aside for retirement.
Earlier this year, Fidelity said that, based on the current
rate of savings, the average American household will live on 59
percent of pre-retirement income once they stop working.
Separately, Boston-based Putnam Investments found in a
survey late last year that a majority of retirees wished they
had started to save earlier in life and about one-third said
they should have saved more.
Putnam, which gives 401(k) participants statements showing
the gap between what they are saving and what they should be
putting aside for retirement, said 75 percent to 80 percent of
people in 52 defined contribution plans the company manages
were not saving as much as they needed to.
In May, human resources services firm Hewitt Associates
said the rate of participation in 401(k) plans inched up a mere
0.5 percent in 2004 to 70.3 percent.