Don’t Use Retirement Funds for a Rainy-Day

Updated: Mar 17



So many of us dream of the day where we can clock out of work for the last time and say goodbye to the traditional 40-hour work week.


However, for some that may not be an economic reality, according to a recent poll conducted by Bankrate 36% of Americans have never even opened up a retirement account.


Bankrate polled 2,225 Americans about their retirement, and here are some highlights: Young people old enough to be in the working world aren’t yet saving. 54% of Generation Z survey participants (born 1997 to 2012), meaning the oldest among them are just 25, simply feel that they can’t afford to save up now for retirement, or anything else for that matter.


According to the findings, the two largest groups who haven’t opened a retirement account are the previously mentioned Gen Z’ers, who have only very recently entered the working world, and those who earn less than $50,000 a year.


Nearly 50% of those earning under $50k, have never had a retirement account.


What is a promising sign, is that pre-pandemic vs during the pandemic retirement saving has increased rather than decreased.



A majority of survey respondents, across all the generations, felt they are behind on their needed retirement savings, but none more so than Generation X (born 1965 to 1980), currently aged from a low of 42 to a high of age 57.


While many have been saving more for retirement since the onset of the pandemic, more than half (51%) of Americans with a retirement account have also dipped in to prematurely take an early withdrawal, which end up reducing the funds available to grow into retirement. 31% did so before the pandemic, 12% did so during the pandemic and 8% withdrew both before and after the pandemic.


A key takeaway that should be garnered from this, is that too many are looking upon their retirement fund savings, as a rainy-day fund, which is not a good practice.



Across all generations, most had taken their first early withdrawal pre-pandemic, however, in the case of Gen Z’ers, an astounding 40% dipped in for a withdrawal during the pandemic compared to the 18% who took it before.


Saving for retirement is hard, but as President George H.W. Bush suggested, once those funds are set aside, they should be kept separate and secure, as if in a lock box. Here is a video to protect that lock box in the future, by creating a rainy-day fund to create an emergency cushion.



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