Although more investors report recovery in their portfolios compared to the market lows of three years ago, fewer Americans are saving for retirement at all, a new study from Edward Jones shows.
According to the survey, 15 percent of Americans have recovered their portfolio losses since the financial downturn (up from 12 percent who reported recovery last year). But 25 percent of people say they are not saving for retirement at all, a 9 percentage point increase since 2010.
Retirement savings are particularly low for younger Americans, the survey finds; those between the ages of 18 to 34 not saving for retirement increased significantly from 26 percent in 2010 to nearly half (49 percent) in 2011.
The survey also showed that although more than half (54 percent) of Americans' retirement portfolios have not recovered at all from the economic downturn, that number is improved from a year ago when 67 percent responded that their portfolios had not yet recovered.
"While we cannot predict market corrections or when the next financial downturn will occur, we do know that it benefits all investors to stay invested through the various cycles and focus on long-term financial goals," said Scott Thoma, Investment Policy Committee member at Edward Jones.
The survey showed slightly more promise for older Americans. Those aged 55 to 64 saw their retirement savings increase significantly compared to the previous year. Twenty-one percent of respondents said their retirement savings are back to normal levels in 2011 compared to 14 percent of those in the same age bracket in 2010.
Americans who expect their portfolios to recover in more than three years also decreased to 21 percent from 29 percent in April 2010.
Other key findings from the survey of 1,009 people, which was conducted by Opinion Research Corporation, included:
- Respondents in the West and Midwest were most optimistic about their retirement savings with 18 percent and 17 percent respectively indicating their retirement savings have recovered.
- While 62 percent of respondents between the ages of 35 to 44 still believe their retirement portfolios have not yet recovered, this is a significant improvement from last year (76 percent).
- The percentage of respondents who expect their retirement portfolios to take six years or more to recover fell slightly to 12 percent in 2011 from 15 percent in 2010.
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