Number of Americans Reporting No Personal or Retirement Savings Rises

    NEW YORK, N.Y. – February 2, 2011 – Thirty-four percent of Americans have no retirement savings and 27% have no personal savings. Just 18 months ago those numbers were moderately lower, at 30% and 22% respectively.

    These are some of the results of The Harris Poll of 2,151 adults surveyed online between November 8 and 15, 2010 by Harris Interactive.

    Generationally, one-in-four (25%) Baby Boomers (aged 46-64) have no retirement savings, with 22% of Matures (aged 65 and over) stating the same. Gen Xers (aged 34-45) are struggling with more immediate issues; 32% have no personal savings.

    In terms of investments, 14% of Baby Boomers and Matures each state that their personal savings is mostly invested in stocks or mutual funds – a greater proportion than younger generations say the same.

    Current economic conditions seem to be driving somewhat less risky investment behavior by Gen Xers, which goes against the grain of traditional investment advice, stated Barbara Bertner, Vice President of Financial Services Research for Harris Interactive. A combination of trust and education would likely bring these consumers back into alignment with traditional investment thinking.

    Other results of this survey include:

    • Most people with bank accounts have heard nothing (24%) or only a little (35%) about new rules about overdrafts requiring bank customers to sign an annual agreement to permit their bank to approve payments that exceed their balances. While two in five (41%) bank customers say they know all about these new rules, only one in every six (16%) have opted in for this service.
    • A 31% plurality of all adults report that they keep their personal savings mostly in bank savings and and/or CDs, 17% keep a relatively equal mix of stocks/mutual funds and investments such as bonds and money market funds, 11% keep their personal savings mostly in stocks and/or mutual funds, 8% keep theirs mostly in bonds, money market funds and other stable investments, and just over a quarter of all adults (27%) say they have no personal savings or investments;
    • The relatively small proportions of adults who keep an equal mix of their personal savings in equities (stocks or mutual funds) is somewhat higher among Baby Boomers and people over 65 (23% and 22% respectively) than it is among those aged 45 or younger (between 7% and 18%);
    • When asked specifically about their retirement savings, rather more people report having these invested mostly (18%) or an equal mix (22%) in stocks and mutual funds. However, 34% of all adults have no retirement savings, including 25% of Baby Boomers and 22% of people aged 65 or older; and
    • Most people have not changed the portfolio mix in the last 6 months of either their personal savings and investments (70%) or their retirement savings and investments (74%). Relatively small numbers have moved their investments into or out of stocks, bonds, bank savings, money market funds and CDs.

    So What?

    It is concerning if Americans are depleting both short and long term investments to make ends meet today-many may not have retirement savings when they need it. Financial experts have traditionally advised younger investors to invest heavily in equities for the long term and older investors to move more of their savings into less volatile investments. It is interesting to see how few people under 45 (and indeed in all age groups) have adjusted to this advice given current economic conditions. It seems Gen Xers are keeping money out of the markets in favor of less risky investments, possibly a result of being skittish about market conditions. As Bertner states above, companies who understand Gen Xers investment attitudes and present new products with that in mind will generate a greater share of wallet among this group.

     

    TABLE 1

    PERSONAL SAVINGS

    How are your personal savings invested?

    Base: All adults

    May 2009

    Nov. 2010

    Generation

    Echo Boomers (18-33)

    Gen X (34-45)

    Baby Boomers (46-64)

    Matures (65+)

    %

    %

    %

    %

    %

    %

    Mostly in bank savings and/or CD’s

    34

    31

    41

    30

    22

    31

    Relatively equal mix of stocks/mutual funds and investments such as bonds and money market funds

    18

    17

    7

    18

    23

    22

    Mostly in stocks and/or mutual funds

    11

    11

    7

    11

    14

    14

    Mostly in bonds, money market funds and other stable investments

    8

    8

    4

    6

    10

    13

    Not at all sure

    6

    6

    7

    3

    6

    7

    I don’t have any personal savings

    22

    27

    33

    32

    26

    14

    Note: Percentages may not add up exactly to 100% due to rounding.

     

     

     

    TABLE 2

    RETIREMENT SAVINGS

    How are your retirement savings invested?

    Base: All adults

    May 2009

    Nov. 2010

    Generation

    Echo Boomers (18-33)

    Gen X (34-45)

    Baby Boomers (46-64)

    Matures (65+)

    %

    %

    %

    %

    %

    %

    Relatively equal mix of stocks/mutual funds and investments such as bonds and money market funds

    19

    22

    10

    23

    28

    29

    Mostly in stocks and/or mutual funds

    21

    18

    16

    27

    18

    12

    Mostly in bonds, money market funds and other stable investments

    13

    10

    6

    6

    13

    16

    Mostly in bank savings and/or CD’s

    8

    8

    6

    4

    9

    14

    Not at all sure

    9

    8

    10

    8

    7

    7

    I don’t have any retirement savings

    30

    34

    53

    32

    25

    22

    Note: Percentages may not add up exactly to 100% due to rounding.

     

    TABLE 3

    PERSONAL SAVINGS CHANGED

    How have you changed your personal savings and investments in the past 6 months?

    Base: Adults who have personal savings

    May 2009

    Nov. 2010

    Education

    H.S. or less

    Some college

    College grad

    Post grad

    %

    %

    %

    %

    %

    %

    Have not changed anything

    62

    70

    74

    75

    60

    61

    Added to bank savings and/or CDs

    21

    12

    12

    13

    15

    9

    Added to stocks and/or mutual funds

    8

    9

    5

    6

    14

    15

    Moved money out of bank savings and/or CDs

    5

    6

    6

    2

    12

    7

    Added to bonds, mutual market funds and other stable investments

    6

    6

    4

    3

    11

    10

    Moved funds out of stocks and/or mutual funds

    9

    5

    1

    4

    8

    8

    Moved money out of bonds, money market funds and other stable investments

    3

    4

    4

    2

    7

    3

    Note: Percentages may not add up exactly to 100% due to rounding.

     

    TABLE 4

    RETIREMENT SAVINGS CHANGED

    How have you changed your retirement savings and investments in the past 6 months?

    Base: Adults who have retirement savings

    May 2009

    Nov. 2010

    Education

    H.S. or less

    Some college

    College grad

    Post grad

    %

    %

    %

    %

    %

    %

    Have not changed anything

    65

    74

    81

    80

    63

    65

    Added to stocks and/or mutual funds

    7

    8

    6

    5

    14

    9

    Added to bonds, mutual market funds and other stable investments

    8

    7

    4

    5

    10

    11

    Have increased my personal 401-k/403B/IRA contribution

    6

    6

    1

    4

    10

    15

    Moved funds out of stocks and/or mutual funds

    10

    6

    4

    5

    7

    10

    Added to bank savings and/or CDs

    10

    5

    6

    4

    8

    3

    Have decreased my personal 401-k/403B/IRA contribution

    6

    4

    3

    2

    7

    5

    Moved money out of bank savings and/or CDs

    2

    2

    2

    1

    4

    3

    Moved money out of bonds, money market funds and other stable investments

    3

    1

     

    2

    3

    1

    Note: Percentages may not add up exactly to 100% due to rounding; indicates less than .05%

     

    TABLE 5

    CHANGING REGULATION

    Historically, when a customer used their ATM or debit card and their account did not have enough money to pay for the transaction, banks would approve the transaction, create an overdraft, and then sometimes charge a fee for the overdraft service. New regulations now require that the customer sign an agreement on a yearly basis to permit the bank to approve these types of ATM or debit card transactions. Unless the customer has opted-in to the service in advance, when an account has insufficient funds, the transaction will be declined. Were you aware that regulations were changing with respect to overdrafts on electronic transactions from bank accounts?

    Base: Adults who have a bank account

    April 2010

    Nov. 2010

    %

    %

    Know all about it

    27

    41

    Heard a little about it

    37

    35

    Never heard of it

    36

    24

    Note: Percentages may not add up exactly to 100% due to rounding; 94% of all U.S. adults have a bank account.

     

    TABLE 6

    OPTING IN

    Under the new laws you can opt-in to allow your bank to automatically approve overdrafts when you have insufficient funds. There would be a fee and you could opt-out at any time. How likely do you think you will be to opt-in to the overdraft agreement?

    Base: Adults who have a bank account

    April 2010

    Nov. 2010

    Generation

    Echo Boomers (18-33)

    Gen X (34-45)

    Baby Boomers (46-64)

    Matures (65+)

    %

    %

    %

    %

    %

    %

    Likely (NET)

    29

    22

    18

    23

    27

    14

    Extremely likely

    5

    4

    4

    3

    4

    4

    Very likely

    9

    7

    7

    6

    8

    4

    Somewhat likely

    15

    11

    8

    14

    16

    6

    Not likely (NET)

    51

    44

    47

    41

    41

    51

    Not very likely

    17

    15

    12

    17

    12

    21

    Not at all likely

    34

    30

    34

    24

    29

    30

    I have already opted in to this type of service

    NA

    16

    12

    20

    18

    13

    Not sure – I would need more information

    20

    13

    18

    12

    10

    11

    NA – I do not have an ATM or debit card

    NA

    5

    5

    4

    4

    10

    Note: Percentages may not add up exactly to 100% due to rounding; NA indicates this was not an answer choice

     

    TABLE 7

    CHANGING BANKS

    How likely are you to change your primary bank in the next 12 months?

    Base: Adults who have a bank account

    April 2010

    Nov. 2010

    Generation

    Echo Boomers (18-33)

    Gen X (34-45)

    Baby Boomers (46-64)

    Matures (65+)

    %

    %

    %

    %

    %

    %

    Likely (NET)

    14

    15

    23

    15

    12

    8

    Extremely likely

    2

    2

    5

    2

    1

    2

    Very likely

    3

    3

    5

    1

    2

    3

    Somewhat likely

    9

    10

    14

    13

    9

    4

    Not likely (NET)

    86

    85

    77

    85

    88

    92

    Not very likely

    30

    31

    29

    33

    30

    34

    Not at all likely

    56

    54

    47

    52

    58

    57

    Note: Percentages may not add up exactly to 100% due to rounding

    Methodology

    This Harris Poll was conducted online within the United States between November 8 to 15, 2010 among 2,151 adults (aged 18 and over). Figures for age, sex, race/ethnicity, education, region and household income were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was also used to adjust for respondents’ propensity to be online.

    All sample surveys and polls, whether or not they use probability sampling, are subject to multiple sources of error which are most often not possible to quantify or estimate, including sampling error, coverage error, error associated with nonresponse, error associated with question wording and response options, and post-survey weighting and adjustments. Therefore, Harris Interactive avoids the words margin of error as they are misleading. All that can be calculated are different possible sampling errors with different probabilities for pure, unweighted, random samples with 100% response rates. These are only theoretical because no published polls come close to this ideal.

    Respondents for this survey were selected from among those who have agreed to participate in Harris Interactive surveys. The data have been weighted to reflect the composition of the adult population. Because the sample is based on those who agreed to participate in the Harris Interactive panel, no estimates of theoretical sampling error can be calculated.

    These statements conform to the principles of disclosure of the National Council on Public Polls.

     

    The results of this Harris Poll may not be used in advertising, marketing or promotion without the prior written permission of Harris Interactive.

    J38848

    Q805, 810, 815, 820, 825, 830, 835, 840

     

     

    The Harris Poll ® #13, February 2, 2011

    By Humphrey Taylor, Chairman, The Harris Poll, Harris Interactive

     

    About Harris Interactive

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