Data culled by the Employee Benefit Research Institute (EBRI) shows that Social Security remains a significant source of retirement income for higher income earners, not just for those with low wages. In 2006, EBRI says Social Security was the largest source of income for those currently age 65 and older, accounting for 39.8% of their income on average. Income from pensions and annuities was 19.3%, income from assets 15.4%, and income from earnings was 23.7%. Also, in 2006, women received a larger share of their income (47.8%) from Social Security than men (34%), EBRI found. The lowest income quintile of elderly (those with less than $8,261 in annual income) received 87.6% of their income from Social Security. The highest income quintile (those with more than $34,570 in annual income) received 18.5% of their income from Social Security in 2006.
A new report by the Consumer Federation of America (CFA) and Wachovia reports that more than half of Americans (52%) say they can’t afford to save or are saving inadequately. The survey, conducted by Opinion Research Corp. in November 2007, polled 2,000 adults. When asked whether they think Americans are saving adequately, 79% said they are not, with nearly half (47%) saying Americans are saving “very inadequately.” College educated folks (86%) are the most likely Americans to feel they aren’t saving enough. Seventeen percent of those polled said they’re not saving at all, while 35% say they are saving but not enough to meet short- and long-term financial needs. Of the more than 1,000 respondents who said they are not saving enough or could not afford to save, 72% cited having higher regular expenses as the reason they couldn’t save, while 72% said unexpected expenses kept them from socking away any money. Low or unreliable incomes was listed by 66% as the reason they couldn’t save, and 60% said large consumer debts hampered their ability to save.