Young Americans with even just $1 saved for retirement are ahead of the pack.
Forty-eight percent of all Americans age 18 to 30 have zero in retirement savings and no access to a traditional pension, according to a GenForward poll by the Black Youth Project at the University of Chicago with the Associated Press-NORC Center for Public Affairs Research.
The youngest in that group are more likely to still be in school, but the trend also holds for those in their late 20s. More than 4 in 10 of those age 25 to 30 have nothing for retirement.
These same Americans are part of a generation whose future retirements, if they happen at all, will be more dependent on their personal savings. That’s because traditional pensions are becoming more and more rare. Only 7 percent of those surveyed say they’re in line to get the coveted benefit, which promises to pay a set amount monthly after retirement.
Plus, young Americans are likely to get less in Social Security benefits than their parents or grandparents. The age to receive full Social Security benefits is climbing, up to 67 from 66. And most young Americans don’t have much faith in the Social Security system to begin with. Only 5 percent say they’re very confident in it, and 28 percent say they’re somewhat confident.
Despite all that, a majority of young Americans still say they are confident that they’ll have enough to retire when they want to. African Americans, Asian Americans and white Americans have similar levels of confidence, between 53 percent and 56 percent. Latinos are an exception. Only 43 percent say they’re very or somewhat confident.
“I feel pretty good about our future,” says Shavonne Henry, a 26-year-old who lives in Vancouver, Wash., with her 25-year-old husband and children. They have some saved up in a 401(k) through her husband’s work and a rolled-over 401(k) account from her old job.
More employers are looking to give their workers, young and old, a nudge to start saving for retirement by automatically enrolling them in 401(k) plans.
There is no magic answer for how much a person needs to have saved for retirement.
Two people with identical ages and incomes could need very different amounts, depending on how long they expect to work, how much they want to spend in retirement and other variables.