SAVING MORE, SAVING LESS
For now, the effects of the recession (including the scary volatility of the stock market) have cut both ways in people's behavior. Certner mentions that some people are saving and investing less, since they're "nervous about the whole system," while others have been saving more in order to make up for declines in the value of their holdings. In its analysis of the Risk Index report, Nationwide noted research of its own on consumer behavior "showing signs that many who were actively preparing before the downturn have now disengaged from the process."

Even among those who are saving more, this may not mean buying more stocks or putting more money into bank accounts, at least so far. Sass mentions the seeming disconnect between government reports of a spike in the savings rate and reports from companies like Fidelity and Vanguard that the rate of investments into funds they manage has been "flat as a pancake." What resolves the seeming contradiction, says Sass, is that people have been improving their finances "by paying down debt. That's how they're saving."

It's certainly not as though people are in the habit of saving in many other ways, apart from contributions to retirement plans at work (if that). As the Risk Index report sternly notes, "Most of the working-age population saves virtually nothing outside of their employer-sponsored pension plan."

A LASTING EFFECT?
Having been badly shaken by the events of the past year or so, will Americans become generally more responsible about saving for retirement? Certner points to the way the Great Depression of the 1930s affected the behavior of those who went through it -- not just at the time, but for the rest of their lives. He says it's "too early to tell" whether our current Great Recession will have a lasting effect. If we emerge soon from the recession, its effect on long-term retirement-savings behavior could be fairly modest. "But if the economy continues to muddle along for some years, we will see a permanent impact," he predicts.

You might think fears about the solvency of Social Security -- a recurring theme of debate in Washington -- would prompt people to save more. But Certner notes that there's nothing at all new about such worries. He mentions a cartoon from the 1930s that displayed this theme, as well as a survey some 30 years ago that showed many young people convinced they'd never get any Social Security payout. "Now, they're about to start getting benefits," he says, "and they're not so skeptical."