Mark Dolliver’s Takes: Life is Too Short for Retirement

Intending to retire and planning to retire are two different things, though many folks are oblivious to this distinction. In a Wall Street Journal Online/Harris Interactive Personal Finance Poll fielded last month, 90 percent of adults said they plan to retire. However, 22 percent haven’t done anything at all to prepare for it. And many of the rest haven’t done much. In fact, just 50 percent of adults claim to have begun “planning” for retirement, which doesn’t necessarily mean they’ve done something tangible like saving money for it. While the traditional defined-benefit pension is fading from the scene, people have been slow to take up the slack with contributions to the newer sorts of personal retirement accounts. The chart below gives an indication of this. As you would expect, respondents with lower household income are less likely than others to be socking money away. Among respondents in the under-$35,000 bracket, just 10 percent contribute to an employer-sponsored retirement account like a 401(k). Even fewer are saving by means of a separate retirement account and/or Roth IRA (8 percent), while fewer still are investing in stocks, bonds and the like (7 percent). The numbers are higher, but not as high as they might be, for those with incomes of $75,000-plus. For instance, 49 percent are contributing to an employer-sponsored account; 20 percent are working with a financial professional.