Building and protecting a retirement nest egg continues to be a major challenge for Americans. Despite progress being made in some areas of the economy, the side effects of the Great Recession have left millions of displaced workers unprepared for their golden years.
A recent report from the Transamerica Center for Retirement Studies (TCRS) found that 62% of unemployed and underemployed workers are “not too” or “not at all” confident about their retirement prospects. The negative outlook can largely be traced to the fact that many new jobs being created are part-time or low-wage. In fact, more than 8 million Americans are underemployed due to economic reasons.
“Amid signs of economic recovery and an improving unemployment rate, millions of Americans are still unemployed or underemployed,” said Catherine Collinson, president of TCRS, in the report. “Many displaced workers have raided their retirement accounts to make ends meet, and many may be overlooking the importance of retirement benefits as they seek meaningful employment.”
Almost 60% of displaced workers report having some kind of a retirement savings account, but an alarming 36% of those workers have made a withdrawal from those accounts. As a result, the estimated median household savings in retirement accounts among all displaced workers is only $7,500.
Let’s take a look at five basic steps to help repair your retirement nest egg. These may seem elementary, but the numbers show that people need every bit of help they can get.