Personal Finance

This Is the No. 1 Reason Americans Can’t Save for Retirement

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As we struggle to save for retirement, one common obstacle blocks the way, regardless of our age: debt.

Almost half of working Americans — 49% — agree with the statement “Debt is interfering with my ability to save for retirement,” according to a recent survey by the Transamerica Center for Retirement Studies.

That includes 20% who “strongly agree” and 29% who “somewhat agree.”

Broken down by demographic groups, the percentages who strongly or somewhat agree with the statement are:

  • Generation Z: 51%
  • Millennials: 57%
  • Generation X: 51%
  • Baby boomers: 32%

The center says it’s of concern that 24% of millennials, 22% of Generation X and 19% of Generation Z “strongly agree” with the statement.

Worries about debt haunt Americans across the age span.

For example, among members of Generation Z — which Transamerica defines as those born from 1997 to 2012 — roughly equal percentages say their financial priorities are paying off student debt (35%) and saving for retirement (33%).

Meanwhile, among members of Generation X — born from 1965 to 1980 — 65% say they are focused on paying down debt, while the same percentage also make saving for retirement a priority.

Overall, 62% of workers say paying off at least one form of debt is a financial priority, while 59% list saving for retirement as a priority.

When it comes to having to decide between paying off debts or saving for retirement, it appears the former is more likely to win.

Among those who have taken a loan from their 401(k) or similar plan, paying off debt is the most frequently cited reason, with 41% of respondents citing that reason. That includes credit card debt (32%) and/or other debt (19%).

How to save more for retirement

If debt worries are keeping you from building a nest egg, consider enrolling in Money Talks News’ retirement course, The Only Retirement Guide You’ll Ever Need.

This 14-week boot camp is intended for those who are 45 or older, and it can teach you everything from Social Security secrets to how to time your retirement. It also teaches you a simple, proven system to destroy every debt you have.

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