The National Institute on Retirement Security (NIRS) recently released a public opinion research report that found that an overwhelming majority of Americans – 86 percent – believe the nation faces a retirement crisis. Some of the findings are:

1. Some 86% of respondents agree that the nation faces a retirement crisis.

2. Three in four Americans remain highly anxious about their retirement outlook even after the economy has begun to show signs of recovery.

3. Even though Americans feel slightly less stressed about their retirement prospects than they did a couple of years ago, support for steady and reliable retirement income from a pension is high and growing. 67 percent of Americans polled said they would be willing to take less in pay increases in exchange for a guaranteed income in retirement.

4. Americans see retirement benefits as a job feature that is almost as important as salary.

 The NIRS poll provides meaningful insight into the attitudes of many Americans. My experience tells me that what many want, guaranteed income in retirement, will not be forthcoming from the government whether one believes it should or not. So, what can we do individually to increase our odds of an enjoyable retirement in terms of financial ability?

The first and clearest action item is noted in item #3 above. Sixty-seven percent of polled individuals were willing to take less in salary in order to have a more secure retirement. Well, we can do that for ourselves. It is called spend less and save more. It has the same net effect with the exception that the future income is not guaranteed by the government. Moreover, as I wrote above, in my opinion that is a non-starter. So, creating a stronger income base for yourself is probably the only thing you can do.

Think about your current income. There are only five things you can do with current income. Yes, only five things. You can, or should I say, have to, pay taxes. Second you have to pay debts. The first two aren’t  voluntary. Third, you have to decide what you will do about “giving back.”  And the fourth is “lifestyle” spending. What always ends up being the last and fifth thing is what do we do with current income? Typically, the answer is save for long-range objectives, which includes retirement as well as college education for children and other lifestyle desires.

What do we typically do? Usually, we spend on current lifestyle and don’t save for long-range objectives. When you see that there are only five things to do with current income, it is quite simple to see what to do. It just isn’t as easy to implement it because we have to say, “no” to some of our current desires in order to secure future long-range objectives. Current lifestyle desires cannot rule all of our decisions if we are to make good use of current income toward long-range goals.

The solution for many Americans who are concerned about their retirement security is to live a little more simply and save better.

By Charles L. Stanley CFP® ChFC® AIF®