What image comes to mind when you hear the word “retirement”?
A comfy lounge chair on a warm, sandy beach? Finally having enough time to devote to your neglected candle-making hobby?
Spending quality time with loved ones without the daily stress of work and money worries?
We all look forward to a restful retirement after years of devoting ourselves to the workforce — or at least most of us do.
But that experience, be it idyllic or productive, might be out of reach. And not just for a few of us.
A recent EPI study shows almost half of American families have absolutely nothing saved for retirement.
We Have Next to No Retirement Savings
The study examined “prime working-age” American households, or those headed by an individual between the ages of 31 and 62.
And the findings were grim. Really grim.
Even the slightly-over-50% of households who did have retirement savings didn’t have very much: The median number is a terrifyingly mere $5,000.
Unsurprisingly, the numbers favored the wealthiest and most established groups — those who already need to worry the least about fiscal matters. Think white, male and college-educated.
Two-thirds of black and Hispanic families had no retirement savings whatsoever, while one-third of their white counterparts were in the same boat. Families headed by a college grad had three times as much saved as those headed by someone with a high school diploma.
Of course, this makes perfect sense: The wealthiest are most able to put money aside for retirement.
But the study shows these gaps widening, not getting narrower: Retirement is yet another cog in the poverty feedback loop.
Ready to Start Saving for Retirement?
If you don’t want to become part of this scary statistic, there’s still time to make it right — but you have to act. Seriously.
Don’t lull yourself into a bad situation by reasoning that your retirement is 30 or more years away.
First of all, if your company has a 401(k) program, get on it — and learn how to use it to meet your retirement goals. It’s automatic savings you won’t see (and therefore won’t be tempted to touch).
Serious bonus if your firm offers a matching program — that’s free money for your retirement! You’d have to be nuts not to take advantage of it.
You can also find other automated ways to save a little bit of every paycheck you make.
And finally, cut unnecessary expenses that can eat up an incredible amount of money over time. Keeping a storage unit could mean you have $20,000 less in your retirement fund!
And, hey, if you really kick it into overdrive, not only will your retirement be cushy — it could be a whole lot sooner, too.
Your Turn: How are you saving for your retirement?
Jamie Cattanach is a staff writer at The Penny Hoarder. Her writing has also been featured at The Write Life, Word Riot, Nashville Review and elsewhere. Find @JamieCattanach on Twitter to wave hello.