In its effort to discover the causes of such great disparities, the paper used the Survey of Income and Program Participation, linked with administrative tax records, to identify causes of such a gap. Ideally, workers should be putting money away on a regular basis, leaving it in retirement accounts once it gets there and monitoring fees so that they get the biggest bang for their bucks.

None of these is happening the way it needs to, the study found, although it's not the fault of the worker. Instead, it has much to do with the retirement system itself that workers are unable to

Below are the four chief reasons people fail to save adequately in 401(k)/IRA plans, as well as two actions that could improve retirement outcomes for participants in 401(k) and IRA plans.

4 REASONS PEOPLE FAIL TO SAVE:

1. Investment fees.

Even when people do manage to put money away in a retirement account, says the study, "Average fees are currently 0.48 percent of assets for bond mutual funds and 0.59 percent for equity mutual funds."

Although that's a noticeable reduction from 1997's 0.84 percent and 1.04 percent, respectively, it continues, fees "still vary significantly by size of plan." And small plans can really get hit hard with fees.

Even if workers have IRAs rather than 401(k)s (which is likely in the face of how difficult it can be to transfer assets when changing jobs), they may be getting soaked on fees without knowing it, since "[f]inancial services firms handling IRAs face no requirement to disclose fees." And although 401(k) fees may have come down, during the period the average 60-year-old was building a retirement account, they were still high—and thus took a toll on asset accumulation.

2. Plan leakage.

With a plethora of ways in which workers can and do withdraw month from their retirement accounts, sometimes it's a wonder that they have anything left.

There are cashouts when changing jobs; in-service withdrawals (either because of hardship, such as medical expenses, funeral expenses, prevention of eviction or foreclosure, repairs for damage on principal residence, principal residence purchase or postsecondary education—or turning 59½, at which time withdrawals are exempt from the 10 percent penalty); and loans, some of which are never repaid and incur that 10 percent penalty.

The report cites household surveys as the source of figures indicating that annual leakage rates amount to 1.5 percent of balances, and tax data that put those rates much higher, at 2.9 percent of assets.

3. Lack of universal coverage.

Since not all workers have access to a 401(k) or an IRA, those people are really behind the 8 ball when it comes to saving for retirement.

Many employers, particularly among small businesses, don't offer a plan—or only offer it to some employees, excluding part-timers, gig workers or other groups. Even among workers who are eligible, the study finds, approximately 20 percent choose not to participate.

And, it adds, "Regardless of how the uncovered are defined, the group without an employer-provided plan is large."

4. Immaturity of the 401(k) system.

Never intended to take the place of retirement plans in the first place, 401(k) plans simply haven't been around long enough for that typical 60-year-old worker to have had access to it as a savings vehicle for retirement for a long enough period to build up a full-sized retirement balance.

And since most workers at its inception were covered by DB pension plans, many chose not to contribute—or perhaps they felt they couldn't spare the money.

As a result, 401(k) balances didn't grow at a rate that would allow them to step in and take over from now-defunct pension plans, leaving those older workers at a disadvantage. Younger workers, who have had access to 401(k)s as retirement savings for their whole careers, should be accumulating larger balances by the time they need to draw on them.

2 POSSIBLE SOLUTIONS:

1. Tightening the rules on withdrawal rules.

One way the study suggests that balances could be improved is to change policy to tighten the rules on allowed withdrawals, although this would only help some workers and to a lesser extent than the chief way to improve the situation.

2. Provide "continuous access" to workplace-based savings plans for retirement for all workers.

This is the chief way the study finds that could generate the greatest improvement in retirement savings balances for workers.

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