Released: October 31, 2006

Savings loses to debt, living expenses

Source: By Eileen Alt Powell, Associated Press

Workers are finding it harder to save for retirement — and fear this could result in a less-satisfying lifestyle after they stop working. A study released Monday by Mercer HR Services, a division of Mercer Human Resource Consulting, found that saving for retirement is still workers’ No. 1 saving goal. But it also found that saving for retirement is losing ground to day-to-day financial demands.

Asked about their savings objectives, 76% say retirement is important, but that’s down from 85% in 2003.

Meanwhile, paying down debt is a priority of 38%, up from 25% in 2003, while saving for unexpected expenses is a priority of 34%, up from 27% in 2003.

Beth Pasciucco, director of marketing, communications and education for Mercer HR Services, said workers “increasingly feel the pressure of today instead of the pressure of tomorrow.”

As workers struggle to save, their confidence about retirement drops, the study found.

Asked how confident they were about being financially ready for retirement, 49% said they were “very confident” or “somewhat confident,” while 51% said they were “not very confident” or “not confident at all.”

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