bank rates

Poll: What Keeps You From Saving?

Spending changes over the last two decades have made it harder to save.We know, we know. You’ve been beaten over the head repeatedly about how most of us aren’t saving enough for retirement.

But few of these studies that scare us with data about dying broke actually get into why it is that we don’t have enough cash stashed away.

Now comes a new think-tank study that attempts to address what’s keeping baby boomers from reaching their retirement goals. (Take our poll at the bottom of this post to answer the question yourself.)

The National Center for Policy Analysis suggests that while 401(k) and IRA accounts have failed to adequately replace vanishing pensions, spending changes over the last two decades also can help explain the savings gap.

Oh, and let’s not forget to mention, even as spending has increased, real income has remained relatively unchanged.

So where are the big changes?

Education: Between 1990 and 2010, education expenses for 45- to 54-year-olds rose by 80%. Adults 55 to 64 spent 22% more.

While continuing education among older adults can explain some of the increase, the study ( concluded that “many baby boomers are helping their college-age children with college expenses and loan payments.”

And those payments have increased much faster than incomes or inflation.

Health care: Insurance premium and out-of-pocket expenses rose 30% for 45- to 54-year-olds and 21% for 55- to 64-year-olds.

From the study: “Insurance premiums nearly doubled as a share of health care expenditures for both age groups. This reflects the growth of health care spending, which has essentially wiped out the gains in median family income over the past decade.”

Utility payments: The cost of gas, water, telephone and electricity service increased about 15% for 45- to 54-year-olds, but “only slightly” for older baby boomers.

Housing: The study also noted that more older boomers are carrying a mortgage than did that age group 20 years ago. Overall, housing expenses among boomers increased about 25% during that time.

Credit card debt: Credit card debt also increased for boomers. Those 45 to 54 saw credit card debt increase by 46%; debt for 55- to 64-year-olds increased by 42%.

This report seems to suggest that boomers, in some cases, are simply living beyond their means. Still, it’s easier to buy a smaller house than it is to find cheaper heart medication. And it certainly seems true that the exploding cost of college is hurting not just students, but their parents.

So, what’s stopping you from reaching your savings goals? Take our poll below.



I'd save more if I didn't have...
  • Add an Answer
View Results

Don't miss out on the next bank deal. Get the newest deals delivered straight to your inbox!

Comments (2)
1 Star2 Stars3 Stars4 Stars5 Stars (1 votes, average: 5.00 out of 5)
2 Existing Comments
  1. zneb said:
    on September 25th at 03:10 am


  2. beloved said:
    on September 25th at 03:13 am

    Maybe if we eliminate some unimportant things in life, we could save much