A new survey from Voya Financial reveals that many Americans wish they had begun saving for retirement earlier.
The study indicates that more than half of Americans began saving between the ages of 18 and 34, with an average start age of 28. However, 64 percent of respondents said they regret not starting to build their savings before turning 25.
“Deciding to save early and often in an employer-sponsored 401(k) or other retirement account is within the control of every employee who has access,” Kerry Sette, vice president of consumer insights and research at Voya Financial said in a statement Thursday. “This can be an important factor in creating an effective plan that leads to financial security in the future.”
The data shows a significant disparity in saving habits across generations, with Generation Z starting to save at 20 on average while millennials started at 24. In contrast, Generation X and baby boomers began much later, at 30 and 32 respectively.
Irrespective of their start ages, each generation wished they had begun saving earlier, with Gen X and boomers wishing they’d laid their financial foundations at 23 and 24 respectively.
“This recent Voya data highlights how the design of a workplace retirement plan can help encourage employees of all ages to maximize the benefits of employer-sponsored retirement accounts — as soon as possible,” said Tom Armstrong, vice president of customer analytics and insight at Voya Financial.
The survey also highlights ongoing challenges in retirement savings. According to Voya’s retirement plan participant data, most of those who changed their savings rate in the first quarter of 2024 ramped it up, including 78 percent of Gen Z and baby boomers, and 75 percent of millennials and Gen Xers.
Still, many struggle with understanding how much to save, including three-quarters of Gen Z (76 percent) and millennials (73 percent) who said they needed help with this aspect.
Economic concerns also played a significant role in hampering savings efforts. Across all respondents, 64 percent of respondents said they were having trouble because of the economy, and 61 percent see inflation as a hindrance to retirement savings. Roughly half also pointed to everyday living expenses (54 percent) and health care costs (49 percent) as significant barriers.
“While employee wellness benefits continue to grow in popularity to support the holistic needs of today’s workforce, the reality is that many individuals don’t recognize the resources often available to them from their employers,” Armstrong said, pointing to health savings accounts, student-loan debt support, and tools for building emergency savings as critical areas of focus.
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