Americans Cite Several Reasons for Not Saving More for Retirement

The top reason Americans aren't saving more money, reported by nearly two-in-five, was having a lot of expenses, a survey found.

For the first time in more than six years of polling, Americans say they feel more comfortable with the savings they have now compared to the year before, according to a report.

However, a Bankrate survey finds they’re not doing a better job at saving: 21% of working Americans aren’t saving any of their incomes, unchanged from last year, while just 25% are saving more than 10% of their incomes, down from 28% last year.

The top reason Americans aren’t saving more money, reported by nearly two-in-five, was having a lot of expenses, and the second most common answer was “haven’t gotten around to it.” After that, other reasons for not saving more include not having a good enough job (16%) and debt, which was a distant fourth on the list at 13%.

“This illustrates what is wrong with Americans and their savings,” says Chief Financial Analyst Greg McBride, CFA. “Too many Americans let their lifestyles dictate what they save or whether they save at all, instead of saving first and living on what is left over.”

Nearly half of American workers (48%) are saving, but saving no more than 10% of their pay, including one-quarter that are saving between 1% and 5% of their incomes. Just 5% of working Americans say they don’t need to save more.

Good savings habits are not purely a function of income, as households making $30,000 to $49,999 per year were nearly twice as likely to be saving more than 15% of their incomes as households making between $50,000 and $74,999 annually. The survey found 22% of households with an annual income between $30,000 and $49,999 are saving more than 10% of their incomes.

Having a lot of expenses was the biggest reason for not saving more for all age groups except the Silent Generation (ages 72 and older). Those that haven’t gotten around to it are more likely younger Millennials (ages 18 to 26) and seniors (ages 63 to 74).

Middle income households had a higher tendency to blame debt for not saving more, and households with yearly incomes between $30,000 and $49,999 were most likely to say it’s because their job isn’t good enough.

The survey was conducted by Princeton Survey Research Associates International by telephone interviews with a nationally representative sample of 1,003 adults living in the continental United States. Interviews were conducted by landline (501) and cell phone (502, including 326 without a landline phone) in English and Spanish by Princeton Data Source from March 2 to 5, 2017.

More information is here.