For Americans under 50, only about one-third will be able to rely on a pension to help fund their retirement, according to our Wells Fargo 2010 annual Retirement Fitness Study.1 This points to a significant generational shift away from employer-funded pensions toward self-funding of retirement through 401(k), IRA and similar retirement plans.
Our survey indicates that, while older Americans are more reliant on Social Security and pensions, younger Americans expect to use—and will rely more heavily upon—work-related income or 401(k)s to fund their retirement income needs.
Overall confidence levels pertaining to Social Security retirement benefits varied significantly by age as well. Fewer than half of the respondents surveyed under age 40 are counting on Social Security to help fund their retirement. And only about one in five in this group is convinced Social Security will even be available throughout their retirement.
These demographic shifts place enormous pressure on individuals to determine how much they will need in retirement to sustain their anticipated lifestyles, how much they need to be saving now to make that happen and where and how that money should be invested.
So what can you do now to better prepare? Use the tools provided on this site to develop a plan that can help put you on the right path to pursuing your goals:
- Retirement Quick View. This easy-to-use calculator will help you determine your retirement goal.
- Retirement Action Plan. Develop your personal retirement action plan in minutes.
- Small Steps to Retirement Savings. This interactive worksheet can help you find even more ways to boost current savings.
What steps have you taken to better prepare for retirement? Do you participate in your employer’s 401(k), an IRA, or both?
1 On behalf of Wells Fargo, Harris Interactive Inc. conducted our 2010 Retirement Fitness Study (PDF) to better understand the impact that the current economic environment has had on middle class Americans ranging in age from their mid-20s to their late 60s.