A new survey from the Employee Benefit Research Institute (EBRI) shows that only 13% of Americans are highly confident they’ll have the money they need to retire.
Now, that’s not in and of itself a tragedy. The concept of retirement is so recent when you consider human history. It’s really only a post-World War II idea that you should enjoy your golden years at leisure. In the past, most people worked until their health declined or until they died.
But let me put a positive spin on the subject. The more you save, the more you have a choice about how much you want to work as you age. You can dial back to part time, you can start volunteering or you can throw in the towel altogether and stop working.
The EBRI survey goes on to say that 1 of 3 Americans have saved nothing for retirement. Of those who have saved something, 1 in 3 have less than $1,000. And half of the 2 out of 3 who have saved for retirement have less than $25,000.
Do you see yourself in any of those numbers? If you feel like you can never save, follow my 1% rule. Start saving just 1% in a 401(k) at work or in a Roth IRA. (See my investment guide below for details on how you can open up a Roth with just $50).
Then I want you to wait for 6 months. If you find you’re not missing that 1% from your life, go to 2%. If you are missing that 1%, wait another 6 months later (until it becomes a full year) and then go up another 1%.
I want you to do this in baby steps. Don’t go for the grand slam, get a single first! Your quality of life won’t decline if you’re just stepping up your personal savings rate by 1% at a time. But your options in retirement will greatly increase over time!