7 Lame Reasons People Don’t Save for Retirement

U.S. workers aren’t saving enough for retirement. Nowhere near it. The annual Retirement Confidence Survey (put together by ebri.org) found that:

“More than half of workers report they and/or their spouse have less than $25,000 in total savings and investments (excluding their home and defined benefit plans), including 29 percent who have less than $1,000.”

Those are troubling numbers. But they’re not new. Over the past few years, the survey has reported similar results.

Obviously people should be saving for retirement, right? So why the disconnect? If it’s as simple as periodically taking some of your earnings and putting it into a retirement account, why aren’t more people doing it?

I’ve made a few excuses in the past and I occasionally hear a few from others. Let’s look at some of these excuses and knock them down one-by-one.

It’s Selfish

This excuse burns me up. Saving for your retirement is the complete opposite of selfish. If you have retirement savings, you won’t depend on the taxpayers, the Church, your kids, and relatives, etc to feed you and house you when you can’t work.

The survey numbers above should destroy this excuse. People aren’t saving. Why? Mostly because they are being selfish with current dollars; they aren’t choosing to give it to their future self.

Saving for retirement doesn’t mean that you have to retire to Bali with a yacht and personal chef. Saving for retirement is about affording life when you can’t work. The retirement industry certainly likes to package it in a flashy way.

But that’s the icing on the cake in my opinion. 401Ks and Roth IRAs are about helping you meet your basic needs. If you have some leftover, give it all away if you like.

It’s Pointless

This isn’t really an excuse. It’s more of a give-up, and truthfully, the comment can’t really be taken seriously. There certainly is a point to retirement savings: providing for you and your spouse when you can no longer physically work to take care of things. I can’t stress this enough.

It’s Too Complicated

It doesn’t have to be. You can save for your retirement using a regular free checking account with the occasional $25 contribution. I don’t recommend that method, but it could certainly be used, and in a year’s time you’d likely be better off than the pitiful $1,000 reported above.

Here’s a wake-up call: to have a little success in life you might just have to learn something. The beautiful thing about the Information Age is that the best investing advice is available to everyone.

Visit your local library, pick up the highest rated personal finance or retirement book, and get crackin’. Too lazy for a book? Download an audiobook or read through this blog.

It’s Only for the Rich

There are many people who retire each year who never had more than a lower or middle-class income. Take Leonard McCracken, 107, who retired back in 1969 after having never made more than $10,000 a year.

You don’t have to be rich to afford retirement. If you can save just 10-15% of your income, then you can really give yourself some cushion for your retirement years.

It’s Only for Old People

The earlier you get started, the easier time you will have in coming up with adequate retirement savings. When you’re young, retirement is a long way off, so it’s easy to avoid the topic altogether.

However, as a young earner, you have most of the same opportunities to save as older workers do, and you’ve got time on your side. You even have the chance to retire early. Get with it.

It’s Too Late to Get Started

This one is tough. There does come a time when it’s too late. But for people in their 50s and 60s this shouldn’t be a valid excuse. Will it require a herculean effort? Probably. Will you have to slash expenses and ratchet up income? Yes. But with things like IRA catch-up contributions and the benefits that come from postponing social security, you have something to help you get there.

It’s Too Risky

Isn’t it worth a little risk? Let’s see, here are your two options: 1. retire with nothing (because you didn’t save) and 2. retire with something. That’s an easy choice. Still, even without that simple equation, it makes sense that you can have control over your risk. If you take control of your retirement savings, you can invest in whatever assets fit your risk tolerance.

If all you can stomach is FDIC insured CDs and bonds, then put all your money there. 107-year-old Leonard (mentioned above) never entered the stock market with his retirement savings. I don’t recommend this completely risk-averse approach, but it can be done.


This article was not intended to present the idea that there are no excuses for not saving enough. The road to retirement is a long and unstable journey for many. Medical issues, divorce, unforeseen catastrophic events; all these things play a huge role in whether you make it to retirement with some money stashed away. But that certainly shouldn’t stop you from trying.

$25,000 (from the survey results above) is a pretty low bar these days. With incomes and lifestyles as large as they are amongst the middle class, we should be seeing more adequate savings. What do you think? Are there other poor excuses for not saving enough for retirement?

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  1. Avatar Kevin@RothIRA says:

    With so many retirement choices and so many easy ways to invest in them there really is no excuse not to save something. Perhaps a lot of non-savers are afraid that they don’t have enough to save an amount that will “make a difference”. (Let’s face it, many retirement advocates hawk seven figure retirement portfolios that many probably feel they’ll never reach so they give up.)

    But even having a small nest egg could, at a minimum, function at least as an emergency fund in retirement. Even if that isn’t a lot of money, it’ll be way better than having none at all.

  2. Julie,

    I totally agree! One can never get back the time that is lost that could have been used to take advantage of compounded interest.

  3. Avatar Julie @ The Family CEO says:

    I’ll add a controversial reason: It’s better to pay off debt.

    True, if you’re paying a ton in credit card interest you should probably tackle that first. But unless you have an aggressive plan for paying off debt and are successfully pursuing it, you probably shouldn’t put off investing for retirement for any considerable length of time. Particularly if you’re passing up an employee match to do it.

    Great post!

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