exasperated-looking womanWhere does the blame lie? At least part of it can be laid at thefeet of 401(k)s. (Photo: Shutterstock)

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Lots of Americans approach fearsome problems by throwing moneyat them—such as climate change (think survivalism supplies) andwellness (think everything from FitBits to vitamin water to youngblood).

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But when it comes to retirement, not so much. Headlines aboundabout how ill-prepared Americans are financially to retire, but they're not throwingas much money at that particular problem.

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That's according to a study from the Kellogg School of Management atNorthwestern University, which found that nearly three-fourths ofAmerican workers with defined contribution plans such as401(k)s are not putting enough into retirementsavings to maintain their standard of living later in life.

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The study assumed that, contrary to what most studies assume,people aren't making rational choices when it comes to finance. Thepremise of the research was to understand how people with specificcharacteristics tended to save over time.

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Enrichetta Ravina, visiting associate professor of finance atKellogg, is quoted saying, putting it this way: “If people behavelike the average person in their demographic going forward, what isthe chance that they will have enough money for retirement?”

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The chance is not good. Calculating workers' lifestyle prior toretirement, researchers then estimated their annual spending levelbased on their age and salary. They found that only about one outof four actually saved enough money to maintain their currentstandard of living once they hit retirement.

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In fact, those who ended up with the most money were dependenton their employers more than their own behavior—they “tended to beemployed by companies that were older and private, possibly becausethese companies also tend to be more established and have higherprofits on average,” the report said. It added that “workers tendedto fare better when they had worked for companies that paid highersalaries and offered more retirement matching.”

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Slow and steady also played a role, they found – asingle percentage point increase in a worker's contribution rateincreased what they'd have at 65 by more than $30,000.

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Where does the blame lie? At least part of it can be laid at thefeet of 401(k)s, with the report quoting Ravina saying that becauseof the shift away from defined benefit plans, “People who have lowfinancial literacy or don't think a lot about the future end upfalling short. Defined contribution plans open up thatpossibility.”

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READ MORE:

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9 ways to help 401(k) participants savemore

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5 retirement preparedness numbers foremployers

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6 companies with the very best retirementplans

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Marlene Satter

Marlene Y. Satter has worked in and written about the financial industry for decades.