A study conducted by the AARP found that 20% of adults over the age of 50 have no retirement savings. More than 70% of those surveyed cited rising housing costs as the top reason why it has been difficult for them to put money aside for the future.
Additionally, data showed that saving for retirement didn’t necessarily lead to feelings of financial security. Of the participants who had savings plans, more than a third of them said that the rising cost of living may leave them unable to sustain themselves during their golden years. More than a quarter of Americans said they expect to never retire.
Nearly one-third of older adults said they carry a credit card balance of $10K or more, while 12% have a balance of $20K or more. This is an 8% increase from last year.
“America is facing a serious retirement crisis. AARP has a long history of supporting legislation to expand access to retirement savings, but Congress must act more swiftly to provide the financial support older Americans need and deserve. But about two-thirds of states have yet to act, and we await action from the federal government,” said Nancy LeaMond, AARP Executive Vice President and Chief Advocacy & Engagement Officer.
Social Security and Medicare will also have an impact on Americans’ ability to retire; the most recent annual report shows that the programs will run out of funds to pay full benefits by 2035.
Congress is considering legislation that would help increase retirement security. The Bipartisan
Retirement Savings Act of 2023 and the Automatic IRA Act of 2024 would both provide retirement savings accounts to eligible workers without employer-sponsored retirement plans.California, Colorado, Connecticut, Illinois, Maine, Maryland, Oregon, and Virginia have already implemented automatic IRA programs. Ten, including New York, Minnesota, and Nevada have passed legislation but have yet to implement their programs.