Talking Retirement

Okay, Maybe We’re Not Saving Enough After All

Over the past couple of months, there’s been a story circulating about how we might be saving too much for retirement. We’ve mentioned it here a couple times. (See here and here for those earlier TR posts.) Today the New York Times has yet another story on this topic, Some More Numbers to Juggle in Figuring Out Retirement.

The basic arguement that the average American was saving too much was based around the fact that most financial services companies suggest that a person needs to be able to have 85% of their annual income available during retirement to maintain their standard of living but a group of economist suggested that we need only about 65%. But a new survery throws some cold water on the situation.

Americans on average were saving only enough to provide them with 58 percent of their preretirement income, counting personal savings, Social Security benefits and pension income.

Fidelity, one of the finanical services companies whose retirement calculators defaults to the 85% figure says the problem is actually even worse. One Fidelity rep says in regard to replacing 85% of a persons income, “Our sense is that is not nearly enough.” Read the story for more.