In spite of improvements in the stock market and household wealth over the past several years, many Americans are not on track to completely cover basic living expenses in retirement. Making matters worse, several factors may prevent Americans from increasing their retirement readiness.
More than half of Americans are at risk of not covering essential expenses in their so-called golden years. According to Fidelity’s new Retirement Preparedness Measure, 55 percent of Americans are behind in retirement preparedness. In fact, the median score indicates working Americans are on track to meet just 74 percent of their estimated retirement expense goals and face a 26 percent income gap.
“While it’s no secret our country faces a looming retirement challenge, the key to making progress is for Americans to know where they stand on the retirement spectrum, and more importantly, understand what can be done to improve their preparedness,” said John Sweeney, executive vice president of Retirement and Investment Strategies at Fidelity. “Although it requires discipline and some tradeoffs, there are important steps people can take to accelerate their retirement savings and get closer to where they need to be in the long run, no matter what their age or income level.”