ST. LOUIS–Many in the U.S. are facing a retirement crisis that has only been made worse by the pandemic, according to new research.
COVID-19 has exacerbated financial stress, prompting many Americans to withdraw from their retirement savings. In fact, noted Clever Research, which conducted the poll, cited Pew Research showing the pandemic has accelerated rates of retirement among Baby Boomers, with 3.2 million more retiring in the third quarter of 2020 compared to the same period in 2019.
Saying it was seeking to better understand how Americans are preparing (or failing to prepare) for retirement, Clever said it surveyed 1,000 workers about their personal finances, retirement savings, and expectations for the future.
Among the key findings was that Americans of all ages generally expect to retire around age 66, but 40% of Boomers say they’ve put retirement plans on hold due to the pandemic.
Key Takeaways
Among the key takeaways:
- 35% of Americans dipped into retirement savings to make ends meet during the pandemic, reporting they spent 44% of their retirement savings on average.
- The average working American currently has $250,813 saved for retirement.
- With an average of $296,064 saved for retirement, Boomers fall 36% short of the recommended $465,000 and may not have time to make up the difference.
- With Social Security projected to run out in 2037, millennials are 61% less likely than boomers to expect it to be their main source of income in retirement. Instead, they plan to save 113% more for retirement than Boomers.
- Among the 30% who have investments, the average American sold 43% of their stocks during the pandemic.
- As the stock market bounced back after a crash early in the pandemic, however, 60% of people who got rid of stocks regretted their decision.
- During the pandemic, Americans have reduced their contributions to retirement funds by approximately 3% on average, though 65% plan to increase their contributions again once life returns to “normal.”
The full research can be found here.