Thanks to all of you who submitted your guesses on retirement decisions!

You can still access the poll, and read the original post.

We always hear that people are not saving enough money in this country, and I was therefore curious to find some actual data on how people are doing with their retirement savings. But I was also curious as to how my readers would estimate the numbers. Here are the results of my little poll and my search:

Poll results. My readers’ guesses on retirement savings, compared to data from the U.S. Census Bureau.

My readers’ guesses are shown in red, and the correct answers according to the U.S. Census Bureau in blue.

Sadly, it turns out you all were not nearly pessimistic enough! The actual data look a lot bleaker than my average reader’s guess. As many as 80% of Americans aged 30-54 believe they will not have enough money for retirement; 38% don’t save anything at all, and only 4% of those who started working by age 25 have an adequate capital for retirement by age 65. Those numbers should scare all of us, whether we are in the fortunate few percent or not.

Income and inheritance inequality aside, what can help people save more money and make the best financial decisions for themselves?

One of the many possible answers is – as so often – education. Financial illiteracy is widespread among older Americans, and financial knowledge and planning are very much interrelated: people with more financial knowledge are more likely to plan and to succeed in their planning. Also, those who do plan are more likely to rely on formal methods, such as retirement calculators, seminars, and experts, and less likely to rely on family or friends. A different study showed that well-informed people are also far more responsive to pension incentives than the average person. In addition, researchers keep discovering more and more thinking traps we tend to fall into when making financial decisions. Once we know those traps, we can better avoid them.

by Ursina Teuscher (PhD), at Teuscher Decision Coaching, Portland OR