According to the SimplyWise survey conducted in November 2020, 28% of Americans haven’t saved any money for retirement over the course of the previous year. And a whopping 58% of people have saved under $ 1,000 in the past 12 months. Unfortunately, these low savings rates weren’t unique to young people who had plenty of time to invest. Among Americans in their fifties, 27% saved nothing.
Unemployment and economic insecurity were the main reasons for the low savings rates last year. 45% of those affected said they had not invested in retirement. This is understandable, as even with extended unemployment benefits, it can be difficult to spend money on future planning when trying to figure out how to pay the bills today.
If you fall behind in saving, it doesn’t have to mean the end of your retirement dreams
While the data on last year’s savings is worrying, the good news is that being out of a year – or even a few years – from contributions doesn’t have to be devastating. You can recover from a bad fiscal year as long as you consider the consequences and adjust your plans for the future.