FACT: New research by the Pew Charitable Trust reveals that more than half of Americans are unprepared for financial emergencies. A third of the survey respondents said they have no savings, and more than half either spend more than they make or break even. 
http://www.pewtrusts.org/en/about/news-room/press-releases/2015/02/26/pe…

The research goes on to suggest that families in the United States are facing substantial and growing challenges in trying to build their retirement savings. The nation’s private-sector retirement system has been in a period of significant transition with the decline of defined benefit pension plans, efforts to restrain projected Social Security deficits, and the growing reliance on individual savings through employer-based 401(k) plans and individual retirement accounts (IRAs). In an era of limited economic growth and constraints on governmental budgets, those seeking to expand Americans’ retirement savings continue to focus on helping individuals build their personal safety net.

Many Americans do not set aside a sufficient amount for retirement, despite changes in policy and employment practices that increased the number of people saving for retirement. A significant proportion of employees still do not have access to a retirement savings plan through their workplace. In response, policymakers are proposing a wide array of reforms to expand access to retirement plans and increase the level of savings.

There were two other findings from this report that I found interesting. The first is that the most recent data from 2014 shows that Americans were relying more and more on company sponsored plans, yet nearly half of U.S. firms—and 70 percent of small businesses—do not offer this option. Secondly, the Plan fees, which include both investment and administrative costs, can reduce Americans’ retirement savings. Thankfully, changes in disclosure requirements for 401(k) plans now require plan providers to disclose fees to sponsoring employers and participating employees. Unfortunately, these fees are still not as transparent as they should be. With these challenges in building retirement savings, it becomes apparent that personal planning is a must. Saving for retirement has become a far more independent process than ever before. It’s more important than ever to have a personal team of experts dedicated to planning for your goals. If you have any questions please contact us at Gainplan.

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