Only a small percentage of Americans maximize their 401(k) contribution limits, Putnam Investments Putnam Participant Poll shows. Only 11% of those under 50 contribute the $12,000 maximum amount and only 14% of those over 50 contribute the $14,000 maximum. Furthermore, the number of people participating in 401(k) plans has dropped by 6% since the beginning of the year, Reuters reports. Nonetheless, 85% of respondents said retirement is their No. 1 savings goal, the Putnam survey showed.
People are reluctant to maximize their 401(k) plans because one in three fears losing their jobs in the next 12 months, Elizabeth Pasciucco, director of marketing, communication and education at Putnam, told Reuters. As well, the poor market has probably been dissuading investors, she added.
The survey also showed that only 54% of people are confident they will have enough money in retirement. "The fact that many Americans dont know what theyll need when they retire demonstrates a need for further education and awareness about investment decisions," Pasciucco said.
Research consultancy Brightwork Partners conducted the survey of more than 2,000 401(k) participants for Putnam.