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News Link • Economy - Economics USA

To retire comfortably, under-40 workers need to seriously bulk up savings

• Jonathon Kern via Prison
If your junior-high soundtrack was more Bangles or Britney than Beatles, I am going to try to scare some sense into you with three words about life in retirement, based on personal experience: The paychecks stop.

I retired last year after 30 years as a broadcast journalist. Unlike most baby boomers who have retired, I do not receive a pension. This surprises and appalls my fellow early retirees, who are either enjoying income from a spouse who’s still working or receiving checks from old employers.

If you’re, say, under 40 — and especially if you’re under 30 — you probably have worked only at firms or agencies that offered 401(k)s or their nonprofit cousin, the 403(b). That means that when you finally do retire 25 or 35 years from now, you will be responsible for providing for your own income. No pension for you!

Much has been written telling you how to prepare for that day — namely, to save every cent you can.

A recent study shows that most people ignore that advice. In the wake of the recession, the Employment Benefit and Research Institute found that, among other things, fewer workers are saving for retirement, a quarter of those surveyed have nearly no savings (i.e., less than $1,000), most workers don’t know how much they’ll need to retire and more than half say their total savings is less than $25,000

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