So how much do you really need to save for retirement? A few hundred thousand dollars? A million? More? Not surprisingly, the answer varies depending on one’s age, health, marital status, income, assets, preferred lifestyle and dreams, among others, according to Gillingham. But regardless of whether an individual is five months or five decades from retirement, delay in planning for retirement can be costly.

“As a general rule, people are retiring earlier and living longer,” says Gillingham. “In addition, eligibility for full Social Security benefits is creeping upward, making it necessary that individuals plan carefully and set aside more money for their retirement years than they might expect.”

Unfortunately, most Americans aren’t acting on that message. More than half (52 percent) of non-retired, working Americans have either not started saving for retirement or have saved less than $10,000 for their long-term retirement needs, and just 10 percent say they have personally saved more than $100,000, according to the survey. This, despite the fact that it may be necessary for many Americans to save more than $1 million to fund a comfortable retirement.

Why don’t Americans simply save more? For most, it’s a matter of “not having enough.” The Thrivent Financial survey found that among those who haven’t started saving for retirement, 54 percent simply say they don’t have enough money, 21 percent say it is too early and 17 percent say they haven’t’ gotten around to it yet. Just 3 percent say they don’t think they need to save for retirement.

However, according to Gillingham, lack of money is not the true stumbling block that keeps people from achieving their financial goals. “A lack of money most often reflects individuals’ commitments to short-term priorities that keep them from addressing their long-term financial needs,” said Gillingham.

Fortunately, nearly half (49 percent) of working Americans say they began saving for retirement by age 35. Still, that means most working Americans are pushing retirement accumulation to the mid- to late stages of their working careers. Why does this matter? As a hypothetical example, a 20-year-old who invests $80 monthly in an investment vehicle earning a constant 10 percent rate of return (compounded monthly) will accumulate more than $1 million ($1,025,535) at his or her retirement some 47 years later. By contrast, a 45-year-old who invests $1,000 monthly in that same vehicle will accumulate just $953,173 by retirement, a difference of more than $72,000. Time is on the side of the steady, systematic investor.

“Retirement is a need that simply cannot wait,” notes Gillingham. “Time is an individual’s most valuable ally in achieving his or her retirement goals.”

A financial professional can help individuals identify personal retirement goals and put strategies in place to achieve those goals. For more information about retirement planning, including retirement planning calculators, visit: http://www.thrivent.com/planning/tools.

Courtesy of ARA Content