NEW YORK (MainStreet) Despite an uptick in the economy, a majority of Americans are still lagging behind in their retirement goals with 55% in fair or poor condition when it comes to having enough money to cover their expenses.
A new Fidelity Investments survey assessed whether Americans could afford basic living expense such as housing, health care and food. Only 33% of Americans reported that even during a down market they could cover 95% of their estimated expenses while 41% stating they were not on track to cover all their expenses in retirement.
Many Americans will lack enough money in their retirement portfolio, because they are not allocating enough money into their savings, said Lauren Brouhard, a senior vice president at Fidelity Investments.
"One of the most important things is that people aren't saving enough," she said. "They are not starting early enough."
While 26% of Americans are likely to face an income gap where they will have to make spending cuts in their retirement especially if the market experiences another downturn, several groups are meeting their goals.
Baby Boomers (born 1946 to 1964) are on track to reach 81% of their goal, but they have fewer options than their younger counterparts to make up any shortfall. Gen X respondents (born 1965 to 1977) are at 71% of their goal while Gen Y respondents (born 1978 to 1988) are falling significantly short and are 62% of their goal.
"The biggest gap is the source of income and the availability of pensions for some people," said Brouhard. "People just don't really know where to get started. They just feel overwhelmed. There are many ways for people to get started and take some critical actions despite their income level or the economy."