Financial security in retirement is far from guaranteed, because Social Security's future is unclear. Social Security's funding from payroll taxes has fallen shy of payments to Social Security recipients since 2010, and according to Social Security's trustees, the trust fund that's been making up for the shortfall will run out of money in 2034, causing an across-the-board cut in benefits of about 25%.
The uncertainty associated with Social Security's future increases the pressure on workers to save more; however, a recent study by Transamerica Center for Retirement Studies finds that a shockingly high proportion of people aren't taking advantage of their employer's retirement savings plan. Furthermore, millions of Americans who are participating in these plans are failing to make the most of them. If you're forgoing a 401(k) or 403(b) plan or only contributing a little to one, then you could wind up running out of money in retirement.
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Why the worry?The average over-65 household's expenses exceed $40,000 per year, yet the average retiree collects just $16,848 in Social Security in 2018. Personal savings are bridging the gap between spending and Social Security; however, most Americans have too little set aside in savings to produce enough income to make up the difference. As a result, retirees' savings accounts are shrinking too quickly.
Advisors recommend withdrawing no more than 4% per year to avoid outliving savings, but most workers have saved too little to stick to that 4% rule.�According to Transamerica's survey, baby boomers approaching retirement have only set aside a median $164,000. At a 4% withdrawal rate, that would only provide about $6,560 per year. For perspective, a retiree with $40,000 in expenses and average Social Security income would need at least $575,000 to avoid drawing down his or her savings too quickly at a 4% withdrawal rate.
A costly mistakeAlmost 30% of workers fail to take advantage of workplace retirement plans, and because 96% employers match at least some of a worker's contributions, those workers are literally forgoing free money.�
The amount of money people are giving up by failing to contribute to these plans, or by contributing less than they can, is significant. According to Vanguard, the median employer match is 4% of income, but 16% of employers match up to 6% or more.�The most common plans match 50% of income up to a set percentage, but many plans will match at least some contributions dollar for dollar.
In 2017, the average worker contributed 6.8% of his or her income to a 401(k). Including employer matches, that resulted in total contributions equal to 10.3% of income.
Those contributions can really add up. For example, a 30-year-old worker saving 6.8% of his or her income from age 30 to 65 could wind up getting more than $100,000 in free money because of employer contributions, if the employer matches 50% of contributions up to 4% of income, the employee gets a 2% annual raise, and he or she earns a hypothetical 6% annual return. At age 65, that person would wind up with a $516,505 nest egg, of which employer contributions were responsible for $117,388!�
What to do nowSaving money can be hard, but employers are making it easier. Many are automatically enrolling their employees in retirement plans, and often those plans include an auto escalation feature that allows workers to increase their contribution by a little bit every year. The auto-escalation feature is a great way to increase your savings every year without busting your budget, so if you're not taking advantage of it, make an appointment with your human resources department to find out if it's on offer. If so, signing up for it could give you the best shot at living the kind of retirement you want, rather than the retirement you can afford.
Wall Street analysts predict that Carter’s, Inc. (NYSE:CRI) will announce sales of $684.12 million for the current fiscal quarter, Zacks Investment Research reports. Four analysts have issued estimates for Carter’s’ earnings, with the lowest sales estimate coming in at $680.20 million and the highest estimate coming in at $689.50 million. Carter’s posted sales of $692.12 million during the same quarter last year, which would indicate a negative year-over-year growth rate of 1.2%. The firm is scheduled to report its next earnings results on Thursday, July 26th.
Brokerages expect Wingstop Inc (NASDAQ:WING) to post $37.14 million in sales for the current fiscal quarter, according to Zacks Investment Research. Five analysts have made estimates for Wingstop’s earnings, with the lowest sales estimate coming in at $36.47 million and the highest estimate coming in at $37.63 million. Wingstop reported sales of $24.67 million during the same quarter last year, which would suggest a positive year-over-year growth rate of 50.5%. The business is scheduled to announce its next quarterly earnings report on Thursday, August 2nd.
Shares of Foxtons Group PLC (LON:FOXT) have earned an average recommendation of “Hold” from the six analysts that are currently covering the stock, Marketbeat Ratings reports. Three analysts have rated the stock with a sell rating, two have given a hold rating and one has given a buy rating to the company. The average 12 month price objective among analysts that have updated their coverage on the stock in the last year is GBX 76.50 ($1.02). 
News stories about Craft Brew Alliance (NASDAQ:BREW) have been trending somewhat positive recently, according to Accern. The research group ranks the sentiment of press coverage by analyzing more than twenty million blog and news sources in real time. Accern ranks coverage of publicly-traded companies on a scale of -1 to 1, with scores nearest to one being the most favorable. Craft Brew Alliance earned a media sentiment score of 0.12 on Accern’s scale. Accern also assigned news headlines about the company an impact score of 45.5957202296867 out of 100, indicating that recent press coverage is somewhat unlikely to have an impact on the company’s share price in the next several days. 
