Employees with access to a 401(k)-type plan amass a significantly bigger nest egg than those lacking access: $87,000 median saved for retirement vs. $10,000 for those without access, according to Wells Fargo.

Yet, 58% of 401(k) plan participants would still like more help with their plan to ensure they are making the best investment choices for their retirement.

In the run-up to National Save for Retirement Week (Oct. 17–21), the “2016 Wells Fargo Retirement Study” found that 59% of workers focused more on avoiding loss than maximizing growth in their retirement investments, with little variation across age groups.

“This relatively conservative approach to investing among younger people may reflect an emotional reaction of day-to-day market volatility,” Joe Ready, head of Wells Fargo Institutional Retirement and Trust, said in a statement. “However, it’s important not to have a knee-jerk reaction.”

Ready said it was also important to make informed decisions about investing in a way that allowed younger workers to use time, their biggest asset, to accelerate their savings growth potential.

The study presented the following illustration of the growth for $10,000 invested in two different ways from Jan. 1, 1976, through Sept. 30, 2016:

• A portfolio allocation of 70% stocks and 30% bonds would have grown to $581,295. An allocation of 30% stocks and 70% bonds would have grown to $336,715.

• “This simple example makes it clear that choosing the right mix of investments relative to your time horizon and risk tolerance is important when it comes to being well-prepared for retirement,” Ready said.

Harris Poll conducted telephone interviews on Wells Fargo’s behalf with 1,003 working Americans and 250 retired Americans from mid-July through mid-August. Working participants were age 30 or older and working full-time (or at least 20 hours if they are working part-time) or were self-employed. Retired Americans self-identified as retired regardless of age. Both groups were the primary or joint financial decision maker for their household.

‘Sweet Spot’

According to the survey, workers 30 or older have saved a median of $40,000 toward a median goal of $500,000. Thirty-four percent have consistently saved for retirement, and these have put away a median $150,000, compared with a $20,000 median for those who have not been consistent.

In addition, consistent savers began saving at age 25 versus age 33 for non-consistent ones.

Wells Fargo said access to a 401(k) plan may have played a role in these savings patterns and balances, as 70% of consistent savers also had access to such a plan, compared with 51% of non-consistent savers.

Higher household income leads to larger amounts saved for retirement and being closer to attaining a savings target, the survey found. Still, even participants with high income had a sizeable gap between what they had saved and what they thought they would need for retirement:

• Those earning $50,000–75,000 had saved $20,000 toward a $500,000 goal.

• Those earning $75,000–100,000 had saved $30,000 toward a $500,000 goal.

• Workers with an annual income exceeding $100,000 had saved $160,000—still only 16% of their target retirement savings goal of $1 million.

“When you combine consistent saving and an age- and risk-based investment strategy, that’s the sweet spot we want people to achieve so they are in a better position for retirement,” Ready said. “In the survey, we heard from many looking for help to get to that sweet spot, acknowledging it was a challenge to get all the pieces to come together by the time they wanted to retire.”

Indeed, 35% workers worried that they would not have enough money to survive in retirement, and 33% of retirees felt the same way. As a result, 48% of workers expected their standard of living to go down in retirement.

All age groups in the survey regretted having started saving too late. Seventy-four percent of those currently in the workforce said they should have started earlier than they did—an attitude highest for 30-somethings, and even a majority of retirees.

The survey findings showed that those in their 30s started saving at age 26, 40-somethings at age 29, 50-somethings at 32 and those age 60 and up at 36. One in 10 of all ages said they had not started saving for retirement.

When asked about what components comprised a retirement plan, workers gave varying answers, especially if they were or were not already saving consistently. A majority of those who had not been consistent savers had not thought about how long their savings would last, how much could be withdrawn on a monthly basis in retirement or how to invest their savings during the draw-down phase in retirement.

The percentages for these factors moved up with age. For example, 38% of 30-somethings had considered the monthly amount they could afford to withdraw, compared with 45% of those 60 and older.

“This suggests the mindset of the consistent saver may be what lends itself to developing a more holistic, comprehensive retirement plan,” said Ready. “The 401(k) plan helps with this as well, as it facilitates consistent saving and includes a level of education and awareness to help workers improve their retirement outcomes.”

Timing of Retirement

The amount of retirement savings is directly related to when people plan to retire and begin drawing on those funds, according to the survey. Participants who were still in the workforce planned to retire at age 66, on average.

The average retirement age increased with age: 30-somethings reported an average expected retirement age of 64, compared with an expected average age of 70 for those age 60 and older and still working. Forty-six percent of retirees said they had retired sooner than they had planned.

Half of workers interviewed said they expected to need to work until at least age 70 because they would not have enough savings to live comfortably in retirement. However, this rate dropped to 35% for consistent savers, compared with 59% of those who were not consistent.

“There are a number of ‘levers’ that one can pull to work toward having enough savings to last throughout retirement, and retirement age is one of them,” said Ready. “Still, it’s important to be prepared to address retiring earlier than planned should an unexpected event arise.”

Workers in the survey acknowledged the importance that a 401(k) plan in being able to save more for retirement. Eighty-six percent of those with access to a workplace plan said they were enrolled and contributing to their account, and 80% felt more secure for doing so.

Sixty-three percent of workers and 73% of retirees said the incoming president needed to define a retirement policy for everyday Americans. One reason: 82% of workers and 73% of retirees agreed that retirement in America is in a crisis state.

—Related on ThinkAdvisor: