Americans Are Unprepared For Retirement

Retirement? Ah, I can’t wait to read those Golden Years. Let’s see, I’ll be 59 in February, meaning I have only another 6 years or so until I hit the deck chair and the beach. Wow, I can hardly wait! Dream on. Unless you have been saving for those Golden Years since you were in your twenties I have news for you. And if you have been saving all those years, I have other news for you.

 

Seventy-five percent of small business owners said that Americans are so financially unprepared for retirement that it’s becoming a crisis, according to a survey by Nationwide Financials released Monday. Still, less than 20 percent of small business owners say they offer employees a 401(k) or other employee self-funded retirement plan.

 

Americans are becoming increasingly concerned about retirement as the economic downturn stymied income growth and wreaked havoc on investments such as stock portfolios and homes. More than three quarters of middle-class Americans said they don’t think they’ll be able to afford to retire until they’re 80, according to a recent survey from Wells Fargo. And two-thirds of Americans ranked not having enough money for retirement as their top financial concern in a recent Gallup poll, up from 53 percent 10 years ago.

 

Despite the retirement anxiety, only 11 percent of small business owners said they plan to offer an employee-sponsored 401(k) plan in the next two years, the Nationwide survey found. And while nearly 80 percent of small business owners say having a retirement plan is important for attracting more qualified employees, more than half say it’s too expensive.

That’s why some members of congress are trying to get a bill passed that would encourage small business owners to pool their resources and offer plans that are less expensive than single employer plans, potentially making some of the administrative responsibilities easier, according to Nationwide officials.

 

The US isn’t the only country where small business owners are struggling to offer retirement options. Due to the economic climate, the British government recently decided to delay auto-enrolling workers at businesses with fewer than 50 employees in pension programs by one year, according to the Telegraph.

 

Start thinking today about an alternative to retiring. It’s a difficult project and requires creative thinking. I was hit with enforced retirement at age 63. At that stage I was aware that the retirement clock was ticking faster than usual and I was busy feeding money into my pension fund as fast as I could. I thought that I would like to work until I was about 70. The engineering company I was managing was closed down overnight and I found myself on the sand on the beach, no deckchair.

I sat on that beach for about 6 months with a pen and notebook, writing down every crazy retirement and money making idea that flashed across my mental screen. Today I am a writer.