The Important will soon become Urgent

Considerable research indicates that very few Americans are on track to save enough for retirement. Most are so far off course that they will likely face rather sobering choices when they reach the traditional age of retirement. Why is this?

Do Americans not care about their future? Surely this is not true. No one wants to spend the last decades of their life worrying about how to pay for basics like rent, food, and utilities.

Are Americans simply not able to save any money? We know that most American workers earn enough income to be able to save at least 10% of their gross income. There are many stories about how even those with low wage paying jobs are able to squirrel money away over their working lives.

Do Americans believe that Social Security will provide enough income to meet their needs? This is rather unlikely, given that it is common knowledge that Social Security is underfunded and will require significant revision to prevent it from collapse.

Are Americans relying on an inheritance to make up for what they have not saved? They had better not. Most Americans will receive no inheritance and those who do will rarely receive enough to make a significant difference in their financial condition.

My theory is that, while almost all Americans believe having sufficient savings in retirement is very important, is not an urgent matter. As we march through the decades of our lives, retirement is always far removed from reality. It is 40 years out, then 30 years out, then 20 years out.

We act upon that which is urgent. If your hand is cut, you stop the bleeding. If your house is on fire, you call the fire department. If the kettle is boiling, you pull it off the stove.

We may or may not act upon that which is important. If we feel it is important to brush our teeth, we do it. If we believe going to church is important, we go. If we feel getting an education is important, we go to school.

Then again most Americans would agree that exercise is important. But most Americans do not exercise. Most Americans feel it's important to maintain a balanced, nutritious diet. But most Americans do not. Most Americans believe charity is important. However, very few Americans give much of their time or money.

Americans know planning for retirement is important. But it's not urgent. So, they put it off. Only when it becomes urgent do most Americans act. Unfortunately, at this point, it is very difficult to do much to improve their prospects for comfortable retirement.