Most American workers are falling short when it comes to saving for retirement. As research has shown, savings trends are getting worse. This shortsightedness costs Americans $1.7 trillion in retirement savings. Ben Steverman writes on Bloomberg: “You’re traveling across the desert, feeling parched and looking dirty. You take a long drink of water from your canteen, then wash your face with the rest. As you’ll discover before you die of thirst in a day or two, you just made a huge mistake. Outside of cartoons, nobody is this stupid. But people make the same kind of mistake all the time, putting their current happiness (vacations, flat screens, new cars) way above their future well-being. Economists call this kind of irrationality ‘present bias.’ And according to a National Bureau of Economic Research study, it and other biases are holding back millions of Americans from saving enough money for that ultimate future need: retirement. How much money? Try $1.7 trillion on for size. That’s 12 percent of the $14 trillion in U.S. individual retirement and 401(k) accounts.” (bloomberg.com)
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