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4 in 10 saving zero for retirement

More than 80% admit they don't know what it takes to save.

By Karen Datko Oct 19, 2010 12:13PM

This post comes from Fred Yager at partner site


Most of us know how important it is to save for retirement and would probably like to save more. But two new surveys show that not only are most of us not saving nearly enough, but eight in 10 say they don't even know where to begin.


Ironically, or perhaps on purpose, the separate studies by TIAA-CREF and Bloomberg arrive just as we begin National Save for Retirement Week.

From the two surveys, here are some of the most interesting findings.

  • 39% or nearly four in 10 are not saving for retirement at all (TIAA-CREF).
  • Only 41% of women feel they will have enough money in retirement compared with 48% of men (Bloomberg).
  • 82% admit that they don't know what it takes to save (TIAA-CREF).
  • 65% say they will not be able to retire in the manner they had hoped (TIAA-CREF).

According to the TIAA-CREF survey, 78% of Americans rely on themselves to make household financial decisions. However, more than half (55%) say they do not really know very much about finance. And while many people report buying things on sale and taking other steps to save money, 85% of those surveyed admit to spending the money they save rather than depositing the savings in a financial account.

For those of you who may not know about TIAA-CREF, it's a financial services firm catering to the academic, research, medical and nonprofit fields. So they're obviously hoping this survey will wake a few people up and cause them to seek help.


Good luck with that.


Financial behaviorists have said that getting people to save rather than spend is like getting someone addicted to nicotine to quit smoking. You can talk all you want but you practically have to make it illegal before anyone actually changes behavior. Even then, one could point to Prohibition and say, "Keep trying."

The key, according to many financial experts, is letting people continue to work beyond their traditional retirement age. Now, if there were only more jobs to allow this to happen. The fact that we still have 9.6% unemployment doesn't help.


The Bloomberg survey polled likely voters to get their findings. Two out of every three women polled believed they would have to work beyond their target retirement age, while only four in 10 men felt the same way.


The poll also reflects that women, who have actually been less impacted by layoffs in the past two years, are more concerned about unemployment. Among women voters, 54% say unemployment is the biggest issue facing the U.S., compared with 43% of men.


More from and MSN Money:

Oct 19, 2010 4:57PM

The scary part is that these people will end up old and broke and then start clamoring for the government to bail them out and provide for them.  The fact is that the government is broke now and will be insolvent and will not be able to bail them out after a lifetime of irresponsibility.


The non-savers of today will learn a very hard lesson about personal responsibility when they find themselves old, broke and destitute.

Oct 19, 2010 1:42PM

I wonder what the age bracket is of the "4 in 10 saving zero for retirement".  I started my full time job when I 21.  I think I went a full year (maybe more or less) without contributing to the company's 401k, until my boss sat down with me and asked me why, and the importance of contributing.  It just wasn't at the top of my priority list at the time.  Well, after that talk I did start contributing.

Oct 20, 2010 3:07PM

If it takes all you have to live then you need to learn how to manage your money responsibly.


You can also upgrade your skills or work ethic so you can make more money or you can get a second job to fund your retirement.


Personally I don’t care where it comes from as long as you don’t expect the government meaning responsible people like me to support you because you’re too irresponsible or lazy to provide for your own needs.


Cable TV is not a necessity, cancel it and use that money to save for retirement.  Cell phones likewise are not necessities (if you need it for work then your boss should pay for it.  If he or she won’t pay for it, then you do not need it for work). Too many people are confusing wants for needs and niceties for necessities, that’s why they don’t save.

Oct 20, 2010 11:50AM
A lot of people live for today and don`t worry about tomorrow
Oct 25, 2010 11:28AM

I came from a very poor background and did not learn anything about money management during my younger days. At about age 30 I visited a couple of family members that had been made awards of the state and were in nursing homes.  Observing the conditions they were living in, with no control on their lives, I decided I did not wish to ever live in such conditions. I immediately started learning all I could about budgeting, finances and investing (long term) so that, in old age, I would have control over who pushed my wheel chair.  At the time I was married with 2 small kids and in a job paying slightly over minimum wage. The more I researched the more I became convinced that people choose to be poor and decided I wasn't going to continue to be poor.


The very first thing I learned was I had to modify my own financial behavior. Once I accepted this fact I started making a plan.

1. Live below my means

2. Budget.......the first 10% of income went to me

3. To make more money I had to make myself more valuable to my           employer.....I started night school.

4. As my income increased most of the increases were invested.


A year after I started college my wife decided she would also start. We both graduated at age 39. I am convinced with the kids seeing both parents attending college they realized the importance of education.  Today one has MBA after his name and the other has MD.


I am sure some will disagree with my statement, "people choose to be poor" so I want to add an example. Let's take two 16 year old 10th graders, one gets pregnant out of wedlock and has the baby and then does the same thing a couple of years later and generally on government aid. The other continues her education, working part time, and becomes a productive taxpayer. Both made a choice, enough said.  


We are both 74, retired, living very comfortably with assets well into the 7 figures. While we didn't need to support my wife's parents we did have to support my parents. With exception of a $14,000 inheritance that my wife received we earned our assists.


So far I have been kind and kept my mouth closed when family members say, "you are so lucky to have such a good retirement". I can also remember visiting a family member in 1989 and the person, who always had a new car every 2-3 years, making the statement, "I can't believe someone with your income would be driving a 1972 vehicle". We make our own luck by planning and setting goals.


About 4 years ago we made application and paid our deposit for a place in an ACTS Retirement Community. I will be controlling who pushes my wheel chair.





Oct 20, 2010 3:25PM

A lot like the grasshopper and the ant.

You all remember how that turned out.

We need a lot more ants.

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