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Subscribe to our free daily WealthManagement newsletters. – Americans are having a harder time saving for retirement because of rising living costs, according to three reports released this week
A survey published by NFP reported that 46% of working adults said they were “deprioritizing or unable” to save for retirement because housing, car payments, healthcare and other everyday expenses are taking priority over long-term retirement planning. The financial strain has forced many to delay saving for retirement or stop saving altogether. About 72% of the 1,000 respondents said they’re off track in their retirement savings goals, according to NFP, which is part of Aon Plc, an insurance and reinsurance broker.
A separate survey published by Schroders Plc found that 27% of 1,500 respondents reduced their contributions to workplace retirement plans or borrowed from their accounts to cover loans and make other emergency payments. One-third of US workers with an employer-sponsored retirement plan reported having more credit-card debt than retirement savings. “Rising costs are forcing tough tradeoffs, and saving for retirement is often the first thing that gets deprioritized,” said Deb Boyden, the head of US defined contribution at Schroders. The result is that a comfortable retirement by 65 is becoming out of reach for many Americans.