The top reason people aren't saving for retirement doesn't have to hold you back, too
Don't give up on your dreams of a secure retirement because of this financial challenge today.
<span data-sheets-hyperlinkruns="{"1":21,"2":"https://www.gsam.com/content/gsam/us/en/institutions/market-insights/gsam-insights/pension-solutions/2021/defined-contribution-survey-2021.html"}{"1":164}" data-sheets-textstyleruns="{"1":0}{"1":21,"2":{"2":{"1":2,"2":1136076},"9":1}}{"1":164}">Throughout the U.S., many people have far too little retirement savings to support themselves after they stop getting paychecks.
<span data-sheets-hyperlinkruns="{"1":21,"2":"https://www.gsam.com/content/gsam/us/en/institutions/market-insights/gsam-insights/pension-solutions/2021/defined-contribution-survey-2021.html"}{"1":164}" data-sheets-textstyleruns="{"1":0}{"1":21,"2":{"2":{"1":2,"2":1136076},"9":1}}{"1":164}">There are some common reasons why so many workers are unable to save for their later years. In fact, more than 9 in 10 people responding to a recent Goldman Sachs survey identified the same key issue that's interfering with their efforts to invest for their future.
<span data-sheets-hyperlinkruns="{"1":21,"2":"https://www.gsam.com/content/gsam/us/en/institutions/market-insights/gsam-insights/pension-solutions/2021/defined-contribution-survey-2021.html"}{"1":164}" data-sheets-textstyleruns="{"1":0}{"1":21,"2":{"2":{"1":2,"2":1136076},"9":1}}{"1":164}">According to Goldman Sachs, 93.3% of current workers indicate that too many financial expenses stand in the way of retirement savings.
<span data-sheets-hyperlinkruns="{"1":21,"2":"https://www.gsam.com/content/gsam/us/en/institutions/market-insights/gsam-insights/pension-solutions/2021/defined-contribution-survey-2021.html"}{"1":164}" data-sheets-textstyleruns="{"1":0}{"1":21,"2":{"2":{"1":2,"2":1136076},"9":1}}{"1":164}">This was the top-cited reason for a struggle to save, above financial hardships such as home repairs, credit card debt, or paying down existing loans.
►Minimum wage:It's bout to rise in 21 states, 35 localities as more embrace $15 an hour
►Procter & Gamble recall:Dry shampoos, conditioners among products recalled over cancer-causing chemical
Retirement savings can't wait
<span data-sheets-hyperlinkruns="{"1":21,"2":"https://www.gsam.com/content/gsam/us/en/institutions/market-insights/gsam-insights/pension-solutions/2021/defined-contribution-survey-2021.html"}{"1":164}" data-sheets-textstyleruns="{"1":0}{"1":21,"2":{"2":{"1":2,"2":1136076},"9":1}}{"1":164}">Having too many pressing financial expenses at the moment can push retirement savings off of your priority list -- especially if you're many years away from leaving the working world behind.
<span data-sheets-hyperlinkruns="{"1":21,"2":"https://www.gsam.com/content/gsam/us/en/institutions/market-insights/gsam-insights/pension-solutions/2021/defined-contribution-survey-2021.html"}{"1":164}" data-sheets-textstyleruns="{"1":0}{"1":21,"2":{"2":{"1":2,"2":1136076},"9":1}}{"1":164}">Unfortunately, the sad reality is that you're going to need to have a nest egg to supplement Social Security, which can only replace about 40% of pre-retirement income -- rather than single-handedly providing the 80% to 90% of pre-retirement funds that you'll need to make ends meet.
<span data-sheets-hyperlinkruns="{"1":21,"2":"https://www.gsam.com/content/gsam/us/en/institutions/market-insights/gsam-insights/pension-solutions/2021/defined-contribution-survey-2021.html"}{"1":164}" data-sheets-textstyleruns="{"1":0}{"1":21,"2":{"2":{"1":2,"2":1136076},"9":1}}{"1":164}">And while you may feel like you have plenty of time to save for retirement in the future, the longer you put off investing, the harder it will be to actually acquire the requisite nest egg. That's because you lose out on the opportunity to have your invested funds earning returns that can then be reinvested to earn more money for you without any effort on your part.
<span data-sheets-hyperlinkruns="{"1":21,"2":"https://www.gsam.com/content/gsam/us/en/institutions/market-insights/gsam-insights/pension-solutions/2021/defined-contribution-survey-2021.html"}{"1":164}" data-sheets-textstyleruns="{"1":0}{"1":21,"2":{"2":{"1":2,"2":1136076},"9":1}}{"1":164}">While you may only have to save a few hundred dollars per month to hit your savings target if you start in your 20s or 30s, you'll likely need to save thousands per month if you wait until late in life to begin investing. That means waiting to start investing can just create more financial problems for you later.
<span data-sheets-hyperlinkruns="{"1":21,"2":"https://www.gsam.com/content/gsam/us/en/institutions/market-insights/gsam-insights/pension-solutions/2021/defined-contribution-survey-2021.html"}{"1":164}" data-sheets-textstyleruns="{"1":0}{"1":21,"2":{"2":{"1":2,"2":1136076},"9":1}}{"1":164}">Here's how you can overcome this big obstacle
<span data-sheets-hyperlinkruns="{"1":21,"2":"https://www.gsam.com/content/gsam/us/en/institutions/market-insights/gsam-insights/pension-solutions/2021/defined-contribution-survey-2021.html"}{"1":164}" data-sheets-textstyleruns="{"1":0}{"1":21,"2":{"2":{"1":2,"2":1136076},"9":1}}{"1":164}">The good news is, there are steps you can take to help you invest for retirement now, even if you are among the majority of people who feel like you have too many current expenses to make this possible. Some of the key steps to take include:
- Tracking spending: By monitoring your spending for around 30 days, you can get an idea of where you're taking on unnecessary financial obligations and what cuts you can make to prioritize retirement investing.
- Prioritizing saving in your budget: If you create a budget to live on and make retirement savings an essential bill you must pay, you can work your other spending around retirement investing rather than saving what's left over.
- Taking advantage of free money for retirement investing: Tax deductions for investing in retirement accounts, employer matching contributions, and the Saver's Credit can all make it easier for you to find the money to invest.
By taking these three steps, hopefully you can find a way to save despite your current financial obligations so you can set yourself up for a secure future.
Offer from The Motley Fool
If you're like most Americans, you're a few years (or more) behind on your retirement savings. But a handful of little-known "Social Security secrets" could help ensure a boost in your retirement income. For example: one easy trick could pay you as much as $16,728 more... each year! Once you learn how to maximize your Social Security benefits, we think you could retire confidently with the peace of mind we're all after. Simply click here to discover how to learn more about these strategies.
Christy Bieber has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The Motley Fool is a USA TODAY content partner offering financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY.