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There are some financial goals that are more urgent for adults right now than filling up their nest eggs.
For 2022, only 17% have made retirement savings their highest economic priority, according to First National Bank of Omaha’s latest economic well-being survey. And nearly half of those surveyed – 46% – said they have less than $ 15,000 saved for retirement.
In addition, 59% are worried that they will not be able to retire when they turn 65 years old.
The survey was conducted in February among more than 1,000 American adults and was weighted to reflect the population.
So what are people more focused on when it comes to their finances this year? About 40% said increased non-retirement savings are their main goal, and another 30% identified paying off on debt.
“While it is a key element of your financial well-being, the priority of retirement savings depends on where you are in the cycle of thinking about retirement, what you have in savings and your personal situation in terms of employment, the size of the debt, etc., “he said. Sean Baker, executive vice president of the individual customer segment for First National Bank of Omaha.
Retirement security is an urgent issue for many workers, as research persistently shows that many people have saved a little up to their golden years. With fewer traditional pensions being offered by companies, retirees generally have to rely on social security and their own savings to finance a pension that can span two or three decades.
About a quarter of American adults have no retirement savings at all, according to a PwC report. Among pension savers, the average 401 (k) account balance for those aged 55 to 64 – ie. people generally approaching retirement status – $ 84,714, according to Vanguard’s latest How American Saves report.
In general, it is recommended that you have 10 times your annual salary saved up if you want to retire at age 67, according to Fidelity Investments.
While it can be difficult to balance retirement savings with other financial priorities, it’s worth trying to save what you can, said Kathryn Hauer, a certified financial planner at Wilson David Investment Advisors in Aiken, South Carolina.
“One way to handle the claims is to commit to paying an amount, no matter how small, in a 401 (k) or [individual retirement account]said Hauer.
If you can not do that, “start small with irregular deposits of the random amount you can save,” she said. “Every little bit helps.”
For 401 (k) plans, the 2022 contribution limit is $ 20,500, with the 50 and above amount allowing an additional $ 6,500 “catch-up” amount (for a total of $ 27,000). For IRAs, whether Roth or traditional, the entry limit for eligible individuals this year is $ 6,000, with an additional $ 1,000 if you are at least 50 years old ($ 7,000 in total).
The survey by the First National Bank of Omaha also showed that 30% of respondents believe that their overall financial well-being is better than it was pre-pandemic, and 44% said it is about the same.
About a third (34%) say they believe their credit history stands in the way of financial well-being.