Bills and Debt Getting in the Way of Retirement Saving? Here’s What Can Help

While the U.S. economy is strong, many Americans are still struggling to keep up with bills and pay down debts. In a recent survey, 34 percent of American workers reported that they either don’t have any money left over or are actually behind on bills at the end of the month. Another 20 percent said if they could change one thing about their past financial management it would be to accumulate less debt.*

When you’re concerned about making ends meet, it can be tough to focus on something like retirement, which may seem like a faraway abstraction. But saving for retirement as early as possible is important, because the reality is that you only get one shot at it. There are no do-overs.

It’s clear from the aforementioned survey that everyday financial obligations are hindering Americans from putting away funds for their retirement. When asked specifically what’s preventing them from saving more for that purpose, some of the most common responses were needing enough money for basic bills, covering unexpected expenses, paying off credit card debt and paying medical bills. These are all real and valid concerns, and prioritizing financial obligations can be a daunting challenge. But again, the sooner you begin preparing for the future, the less catch-up you’ll have to play at the end of your career.

So where can you turn when you’re challenged with so many competing financial obligations? Try starting at work. Research shows that more than half of employers have implemented or are considering implementing a financial wellness program.** These programs may provide education, tools and resources to help with your overall financial health, including tips on how to budget money for pressing concerns in the present while keep an eye on your future needs.

Another place to seek help at work is related to your 401(k) plan, which is most people’s largest or only source of retirement savings.*** Many workplace 401(k) plans offer professional advice or managed account services, which can help you create a personalized retirement saving strategy based on multiple data points about your unique situation. This can include things like salary, anticipated date of retirement, risk tolerance, marital status and more.

This kind of advice can go a long way towards helping you make more informed and confident investing decisions. According to the survey I mentioned, three-quarters (73%) of workers would be very or extremely confident making investment choices with the help of a financial professional, compared to just 49 percent who would feel that level of confidence on their own.

Despite all the benefits of these kinds of programs, not everyone is comfortable asking for help. Even worse, some people may not feel worthy of it. In fact, 42 percent of workers surveyed said they do not feel as though their current financial situation warrants financial advice. One of the major conclusions of the survey was that people know they’re responsible for the money they’ll need in retirement, with some 84 percent saying they’re relying on themselves or their spouses for those funds. But being self-reliant and asking for help are not mutually exclusive.

No matter your current situation – whether you have $1,000 or $100,000 – that is your wealth. And it merits attention so you can make the most of it. If you have access to a financial wellness program or professional 401(k) advice at work, please consider taking advantage of it. Think of it this way: you go to a mechanic when your car isn’t working, you go to a doctor when you’re sick – it makes sense to call in a professional with something as important as managing your money and preparing for retirement.


* 2017 401(k) Participation Survey conducted by Koski Research for Schwab Retirement Plan Services, Inc. Koski Research is not affiliated with Schwab Retirement Plan Services, Inc.

** 2017 Workplace Financial Wellness Study conducted for The Charles Schwab Corporation by P&I Content Solutions Group. Statistical analysis was conducted by Signet Research Inc.

*** 2016 401(k) Participant Survey conducted by Koski Research for Schwab Retirement Plan Services, Inc. Koski Research is not affiliated with Schwab Retirement Plan Services, Inc.

The information contained herein is proprietary to Schwab Retirement Plan Services, Inc. (SRPS) and is for general informational purposes only. None of the information constitutes a recommendation by SRPS. The information is not intended to provide tax, legal, or personalized advice. SRPS does not guarantee the suitability or potential value of any particular investment or information source. Certain information provided herein may be subject to change. 0917-72FL

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