Let's start the year off on the right foot by proposing some good news. What if all the dire warnings about the lack of retirement readiness are wrong? "Ridiculous!" you say? With a 2016 study from the Economic Policy Institute (EPI) saying the mean retirement savings is only $5,000 and with Aon-Hewitt's much quoted "85 percent salary replacement ratio," it's easy to see how there might be a retirement crisis.
But if we drill down those numbers, we begin to see a different picture. First, what the EPI really emphasizes is the number of people who haven't saved much for retirement. In other words, the reason why that $5,000 is so low lies in the number of people who have no retirement savings at all. If we only include those who have retirement savings, the mean explodes up to $60,000. Sure that's not much, and neither is the average retirement savings of $95,776 (which, again, includes families with no retirement savings), but it's not exactly nothing. And that "not nothing" is something of an advantage for retirement savers—good news for them at least.
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