While Americans’ personal savings rate, 1.1% in 2004, lags behind most all developed countries, US workers and their employers are investing more into retirement accounts than other nations, according to the Journal report.
The newspaper said a recent survey, sponsored by London’s HSBC Holdings and San Francisco-based consulting firm Age Wave,shows around 52% of American workers contribute to such plans compared to 40% of workers in the UK, 22% in China, and 9% in India.
Despite concerns, the Social Security system is in better shape than other countries’ pensions systems due to their systems’ funding shortfalls, the Journal said. The news report also noted as an example that, though Japan had a 5.1% savings rate in early 2004, public-pension payouts are being lowered by raising the retirement age and boosting premiums.
Of course, these pension problems in other countries could affect the US, and the recent findings do not mean that all American workers are prepared for retirement, the Journal said. According to Hewitt Associates, nearly 30% of eligible employees do not participate in their company’s 401(k) plan. However, according to Steve Troop, group head of HSBC Holdings’s retirement business. “The US is probably considerably ahead of a number of countries.”
-Rebecca Moore
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