Study Shows People Need to Play Retirement Savings Catch-up In 2022

Many Americans face a retirement savings crisis, exacerbated by almost two years of the COVID-19 crisis. The financial blowback from the pandemic continues to plague a wide cross-section of Americans, including those closest to retirement age.

Unfortunately, most people are not saving enough right now. During the pandemic, Americans reduced their retirement contributions overall by 3%, with millennials reducing their contributions by 1%, Gen Xers by 11%, and boomers by 5%.

New research has uncovered the following key takeaways about how Americans have dealt with the financial stress of the pandemic: Click below to see some statistics.

Pandemic Effects on Retirement Saving

Though there’s evidence to suggest that some Americans adopted better saving and spending habits during the pandemic, others are still struggling with the impact of the pandemic’s financial strain, a reminder that not all financial setbacks are equally distributed. 

A Split of Pandemic Personal Finance Habit

Still, most Americans view the financial setbacks as temporary and say they’re in “recovery mode.” Moreover, more than half say they’ll update their retirement strategy when the dust from the pandemic settles, with 65%  saying they plan to boost their retirement contributions. 

Looking Forward to 2022 and Beyond

Boosting contributions to an employee 401(k) plan is a solid strategy, especially since the average 401(k) balance was up 4% in the third quarter of 2020 to $109,600 from $105,200 in 2019 although more people are saving less money during the COVID-19 crises. 

Strategies for 2022 Retirement Fund Recovery