Ideally, each generation in this study would be much farther toward their retirement savings goals — particularly because they have access to retirement plans provided by their employers.
But other financial concerns get in the way.
The biggest one: daily living expenses, which was cited by 65 percent of respondents. That was followed by generational debt, with 43 percent; housing costs, 43 percent; and health-care costs, 32 percent.
What makes matters worse is that 22 percent of workers admitted to taking a lump sum distribution from their retirement funds without moving the money to another plan.
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It’s not all bleak when it comes to retirement. There will be other sources of income, such as Social Security or the proceeds you may see if you decide to sell your home.
But Farrington said workers would be wise to understand the benefits that contributing to a workplace plan can bring. That includes the potential savings from lowering your taxable income, the extra money you may receive from employer matches, and the potential to save more once you’re 50 and older through catch-up contributions.
“There’s a lot of good stuff in a defined contribution plan that we want to make sure people are fully educated around so they can make a choice and start closing the gap,” Farrington said.