If you think most American workers have financially recovered from The Great Recession, think again. A multi-year study found that only 39 percent of workers believe they have either fully financially recovered (20 percent) or were not at all impacted (19 percent). The rest are still trying to catch up.
There is a silver lining in that news, however. The 17th Annual Transamerica Retirement Survey: A Compendium of Findings About American Workers reported that this dismal number was an improvement over the past two years. In 2015, 37 percent of workers surveyed said they had fully recovered. In 2014 only 29 percent did.
"American workers are still struggling to regain their financial footing from the Great Recession and its aftereffects. Most are concerned about the future of Social Security and few are very confident about their retirement prospects," said Catherine Collinson, president of Transamerica Center for Retirement Studies, a division of Transamerica Institute, a nonprofit, private foundation.
Social Security was the most cited retirement-related priority when those surveyed were asked about what the next president and Congress should tackle. Recent debates about how to fully fund this program may contribute to how workers view retirement. While 62 percent are confident that they will be able to fully retire with a comfortable lifestyle, only 15 percent are "very" confident and 47 percent are "somewhat" confident.
The three most cited fears: outliving savings/investments (51 percent), reduction of Social Security payouts (47 percent), and declining health requiring long-term care (45 percent). There’s a good reason for those worries. Few Americans have saved enough for retirement.
Baby Boomers, the generation born between 1946 and 1964 and now entering retirement, have an estimated median retirement account savings of $147,000. A mere 22 percent have less than $50,000 saved.
Women are the most vulnerable:
▪ They have less in savings, with a median of $34,000 in household retirement savings overall (the same as in 2012) while men have $115,000 (up from $50,000 in 2012). The contrast is sharper among boomers: women have an estimated median of $109,000, while men with $211,000.
▪ They participate less in workplace retirement savings programs. When offered a 401(k) or similar plan, women contribute 6% of pay (median) while men contribute 10% (median).
▪ Fewer save for retirement. Seventy-two percent of women save compared to 80 percent of men. Fewer women — 56 percent — also monitor and manage those savings — compared to 70 percent of men.
Collinson told Forbes magazine that both the gender pay gap and women’s choices to take time off from work to provide caregiving are among the likely reasons they lag their male counterparts.
"In the overall context, there are some societal differences that make it more challenging for women to save," says Collinson.
The Transamerica report, based on a Harris Poll survey of 4,161 U.S. workers, also includes analysis of more than 50 broad measures of the retirement outlook of American workers, including access, employer-sponsored retirement benefits and savings rates.