Cream of US Society have Zero Retirement Problems


A number of studies have shown that the United States face a tough time when it comes to the matter of retirement savings. This is not a surprise as majority of those employed subsist from one paycheck to the next paycheck. It is extremely hard to extract money for retirement when the money earned is just to meet the monthly expenditure.

Huge difference

However, exceptions exist. These demographic says that there is no retirement crisis and all is normal. This strange economic phenomena is explained by Economic Policy Institute. The institution points out that the one percent of Americans having more than adequate retirement savings skews the average retirement sums for the total employed American population. In fact, a media house has reported that the savings disparity between one percent of Americans and the rest are so much that the people at the bottom of the pole cannot even dream of rising above the percentile they have succumbed to.  As per a study by the EPI, the cream families have about $1.08 million or more money squirreled away. This number is 216 times average working age family belonging to the 50th percentile. The last have saved only $5,000. All figures are of 2013. In contrast, families in 90th percentile had approximately $274,000 stashed in financial instruments. This amounts to 55 times total of the average American family.  The ones in 80th percentile had about $116,000. This comes to 23 times average family.

Unequal world

It is readily apparent that retirement savings participation is most unequal across all income groups. Almost nine out of 10 families in 2013 belonging to the top layer had adequate retirement account savings. This can be contrasted with fewer then one among 10 families belonging top the bottom income fifth. For the bottom families, the future is quite bleak.

Before one jumps to conclusions, it is to be remembered that median and mean are not same. The report elaborates on this matter, saying that across the United States, median retirement savings comes to $5,000. For families with few savings, the median comes to $60,000. The report points this out, saying that the huge gap existing between the median retirement savings and mean retirement savings mean large inequality. It is clear that families with large savings are pushing up the averages of all the rest of the families. This report also points out that retirement wealth has not grown as fast to keep with the requirements of the aging population, thanks partly to 401(k)s.

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