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Americans Aren’t Breaking the Retirement Bank…
But They Can Get on Track with a Self-Directed IRA

A 2018 Retirement Savings survey by GOBankingRates found that American adults on average are not doing well when it comes to saving for retirement. While this isn’t new, the percentage of Americans with nothing ($0) saved has dropped, and the percentage of those who have at least $300,000 in their retirement plans has increased over the past three years.

The survey targeted three age groups: Millennials, Generation X and Baby Boomers, with about 1,000 respondents per group. They were asked to estimate how much they have saved for retirement and were given assorted ranges to select from (less than $10,000 to $300,000 or more).

The alarming result is that 42 percent of those surveyed have less than $10,000 saved—that’s not even enough to cover one year’s worth of living expenses, which according to the Bureaus of Labor Statistics, is on average, $46,000 a year for adults 65 and up. Included in this group, 14 percent have nothing saved for retirement. Luckily, as noted above, this percentage is dropping.

Summary statistics: The percentage of people who could retire broke, with less than $10,000 saved, has shrunk in recent years as per the GOBankingRates Retirement Savings survey:
2016 – 56 percent
2017 – 55 percent
2018 – 42 percent

Here’s a silver lining: the survey revealed the majority of Americans have more saved for retirement, broken out as follows:

  • Nearly 7 percent saved $10,000 to $49,999
  • Nearly 13 percent have $50,000 to $99,999
  • More than 12 percent have $100,000 to $199,999
  • Nearly 10 percent have $200,000 to $299,999
  • About 16 percent have $300,000 or more in retirement savings

Among the reasons cited for not saving, about 40 percent said they don’t make enough money to save, and around 25 percent reported they are struggling to pay their bills.

Statistic: 57 percent of Millennials have $10,000 or less saved for retirement

Millennials had the highest percentage of respondents with nothing saved (18 percent). Given they are still in the early stages of their careers, it’s not that surprising. Another 39 percent of Millennials have less than $10,000 saved—but at least they have a longer time horizon to catch up. However, the total percentage among this group that reported nothing, or less than $10,000 saved, dropped significantly from last year and the percentage of this generation with $300,000 or more saved has grown slightly—all encouraging signs for these younger workers.

Baby Boomers, who are now facing retirement, are also facing some challenges in terms of saving for retirement.

Statistic: Although 23 percent of Baby Boomers (55 and over) have saved $300,000 or more, about one-third have less than $10,000 saved

Don’t be a statistic! Start saving for retirement with a self-directed IRA

Whether you’re a younger worker, a mid-career Generation Xer or a Baby Boomer looking to retire now or very soon, there’s time to catch up on your retirement savings. With a self-directed IRA, you could build a more diverse retirement portfolio with alternative assets such as real estate (investment property), commodities (agricultural, energy, livestock), precious metals, private placements, and many more.

You can open and self-direct a Traditional or Roth IRA, a SEP IRA if you are self-employed, or a Solo 401(k). If you are comfortable making your own investment decisions or already know and understand certain non-traditional investments, you can include them in a self-directed IRA. It doesn’t take much to start; you can even roll over or transfer an existing retirement account into a new self-directed plan.

Want to learn more? Read more about self-direction in our white paper library or contact Next Generation with your questions; call us at 1.888.857.8058 or email NewAccounts@NextGenerationTrust.com.