The retirement crisis in the United States worsens. A new report suggests that a majority of American households do not have any savings in an individual retirement account (IRA) or 401(k)-style accounts.
Last week, the Government Accountability Office (GAO) released a study that found 42 percent of U.S. workers do not have access to a work-sponsored retirement plan, and nearly two-thirds (60 percent) of U.S. households have zero retirement savings.
By the time Americans retire, one-fifth of all households won’t have any retirement savings to rely on, and this includes one-third of the poorest Americans.
To circumvent a retirement crisis, the GAO suggested that Americans sign up for every single retirement plan that is offered to them. By doing this, the GAO says, you increase your monthly income by 19 percent overall. However, this would be difficult to achieve either on the part of the employer or on the part of the employee.
Here is what Bloomberg Insider writes:
“Neither companies nor workers necessarily have extra money to plow into savings. For the poorest workers, saving for retirement is naturally a lower priority than paying rent or saving for more immediate emergencies, the GAO notes. Forcing people to save might just result in them taking on additional debt, or skipping such important expenses as preventative medical care.”
With Social Security on the brink of insolvency and Americans not saving anything for retirement, what’s going to happen to future generations of retirees? It shall be very interesting to say the least.
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