Something in the Way

Inflation is impacting retirement savings

Inflation is getting in the way of Americans’ golden years. A new report has found that a little over half of American adults have stopped saving for retirement because just about everything is more expensive right now.

Inflation is near a 40-year high, so it’s not hard to see why this would impact savings. The study of over 1,000 adults found that 54 percent were either stopping saving for retirement completely or reducing the amount they saved. About 80 percent of respondents said they were worried inflation rising over the next six months would hurt purchasing power. Another 75 percent said they were concerned that rising costs would negatively impact their previously planned retirement goals.

The inflation worry was spread across generations. Sixty-five percent of millennials said they stopped or reduced their retirement savings due to inflation, compared to 40 percent of boomers and 59 percent of Gen Xers.

There was some positive news from the study. Despite inflation and retirement worries, Americans are ready to jump back into the stock market. The report found that the percentage of Americans who said they were ready to invest jumped from 17 percent to 26 percent. Millennials were the most likely to say they feel ready to invest in the market, at 46 percent. This is a good sign. Inflation is making things tough, but staying invested is the best way to make sure your retirement savings are ready to go when the time comes to say goodbye to work.

Chris O'Shea

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