A Charles Schwab survey found that 62% of U.S. workers felt inflation is a primary roadblock to saving for a comfortable retirement, up from 45% last year. Workers also felt they needed $1.8 million in savings to adequately retire.
Brian Bender, head of Schwab Workplace Financial Services said persistent inflation inevitably leads to workers feeling greater financial pressure, although many still prioritize setting aside funds for retirement. Savings rates for 401k accounts have remained steady,, Bender said.
Schwab found that a mere 37% of workers feel they’ll meet retirement savings targets, down 10% from last year. “Confidence may have taken a hit, but savers are still hopeful: nearly half still feel somewhat likely to reach their goals and only 14% feel they are not at all likely to reach their goals,” the survey said.
Survey respondents felt retirement planning advice from their employers would be beneficial for their financial health, including information about the implications of recent retirement legislation.
Around 1,000 U.S. 401k plan participants participated in the survey, which was conducted by Logica Research between April 19 and May 2 of this year. Respondents were employed by companies with 25 or more employees, were 401k plan participants and ranged in age from 21 to 70 years old.
“It’s encouraging to see that many workers are in tune with the evolving rules and regulations surrounding their retirement plans,” said Marci Stewart, director of communication consulting and participant education for Schwab Workplace Financial Services. “By understanding what matters to employees, employers can drive engagement as they fine-tune their benefit offerings to optimize recruitment and retention.”