My name is Mark Hassell, and I have been employed in the financial services arena since the year 2000. I have met with literally thousands of individuals over the years to assess their current retirement savings situation. I must say that after conducting thousands of these meetings, I am extremely concerned about the amount of retirement assets current workers have saved. In addition, I have met with many, many others in retirement that are now struggling to get by, seeing now the amount they had saved for retirement did not last as long as they had hoped it would.
I believe if you asked 10 people what their retirement dreams would entail, you would probably get 12 different answers, but the one common theme that would, or at least should, be a part of that overall picture is having enough money to make one’s retirement dreams a reality.
In my current role, I meet with employees of a large healthcare organization in the Roanoke Valley to review their retirement situation. After meeting with approximately 1,300 employees over the past 17 months I can report the vast majority of the people I meet with are grossly underfunded when it comes to their current retirement savings. In fact, the average retirement account balance is approximately $24,000, however, the median account balance is just $6,200. Certainly, there are some employees who have much larger savings accounts outside their current employer sponsored plan. Some, but not very many.
This is a problem that is not just confined to the Roanoke Valley, the Commonwealth of Virginia, or the Southeastern United States. It is a problem that is becoming a potentially significant long-term economic headwind. A 2014 study by the investment firm BlackRock, entitled the BlackRock Global Investor Pulse Survey, found that 40% of Americans had not even started saving for retirement. Think about that fact for just a moment….Nothing saved for retirement at all. Nothing in a 401k or other type of employer sponsored plan, nothing in a Traditional or Roth IRA. According to their study, BlackRock found the average American has about $58,000 earmarked for retirement. Not great, but maybe not at a crisis level until you dig a little deeper into the data. If you look at just the larger investors, labeled as affluent investors, (those with investible assets over $250,000), the average retirement savings balance stands at approximately $342,500. However, if you look at those with less than $250,000 in investible assets, the average account balance drops to just $29,358.
In light of this survey and many, many others, I have to ask the question – is retirement a reality or just a dream for most Americans? I plan to use this blog as a forum to address the retirement savings issues workers currently face, and share some strategies to help people make better choices as they attempt to tackle this daunting challenge of saving for retirement. There are no shortcuts, “weird tricks”, or one-size- fits-all retirement savings plans. It is not a journey of get rich quick, on the other hand, it is having a savings strategy in place, and executing that strategy throughout your entire working career (not just when you are “old”).