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Retirement Planning > Saving for Retirement

Why Workers Aren't Boosting Retirement Savings

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Only 29% of working Americans increased their retirement savings contributions in 2018 vs. 2017, and 16% saved less for retirement than they had in the prior year, according to new research from

Still, the percentage of those who raised their contributions last year was nearly double the 2011 rate, when just 15% of workers increased their retirement contributions from the previous year.

Forty-six percent of research participants reported that they are saving the same amount as last year, with little difference among income groups.

Bankrate conducted the study via landline and cell phone by SSRS on its Omnibus survey platform between July 23 and Aug. 4, 2019, among a sample of 2,016 respondents.

The study found that the tendency to save more for retirement this year than last year increased with income level. Forty-one percent of households with $75,000 or more of income increased contributions this year, compared with 20% of those with $30,000 or less of income.

Conversely, the lowest earners were four times likelier than the highest earners to be saving less for retirement this year, and one in 10 of the former did not save anything for retirement last year or this year.

The likelihood of increasing retirement contributions is consistent among those between the ages of 23 and 64, with millennials 30 to 38 likeliest to say so. Among workers 65 and older, the tendency to have decreased retirement contributions rises as hours worked tends to decline for those easing into retirement.

“The power of compounding makes time your greatest ally when saving for retirement, and adds an urgency to contribute now not later, giving your money more time to grow,”’s  chief financial analyst Greg McBride said in a statement. “At any age, there is no better time than the present to ramp up retirement contributions.”

Reasons, Excuses

The study also looks at why more working Americans have not been increasing their retirement contributions this year. Twenty-four percent of those surveyed said they are comfortable with the level of their retirement savings or the amount they contribute — a response that increases with age.

Twenty-three percent of respondents cite stagnant or decreasing income as why they are not saving more, a response that skews heavily to the lowest earners who are nearly twice as likely to say this than any other income group.

Sixteen percent of respondents explain they are focusing on another financial priority, and 12% cite rising household expenses. Another 12% say they have not got around to increasing their contribution; this is a common response of younger millennials and those with lower-than-average household incomes.

“The reasons Americans cite for not increasing retirement contributions indicate a continued lackadaisical approach to retirement savings — whether it is complacency with current contributions, focus on other financial priorities, rising household expenses or just not getting around to it,” McBride said.

“Saving for retirement needs to be made a bigger priority for the millions of Americans that aren’t saving, got started late, or are behind on their retirement savings. Millennials, in particular, have the most to lose by waiting to contribute or delaying a boost in contributions.”


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