Americans aren't saving for retirement. Or maybe they can't?

[Danno 1,228]

I set limits to how much we spend when we dine out and when we go grocery shopping. He went to Petco alone last Saturday and arrived home with a drinking fountain that costs $ 75 for our cat. I confronted him about that. Wise huh. He found a way not to take me with him by going to his doctor first.

Calypso, you are a Jewel.

[Jay & Beverly 0]

One thing that I haven't seen talked about that probably contributes to the low savings rate by individuals in their mid to late 20's is student loans. It would be interesting to know what the percentage of people in the age group went to college and are unable to save because of the loans they had to take to finance their education. I took a road less traveled and went into the Navy instead of going off to college like my classmates from high school. I was only in for 5 years which was as long as several who completed their masters programs were in school. Within 9 months of getting out of the military I was a home owner. I remember comments from many friends who couldn't imagine being a home owner because their loan repayments prevented them from saving for a house, let alone saving for retirement.

This year is our 20 year reunion and along the way we've all talked about things we wished we would have done by this point in life. I wished I would have been smart enough to finance my mortgage over 15 years as I would only have 5 more payments left. I have half a dozen close friends that I still in contact with from high school, all but 1 of them have only been able to purchase homes in the last 3 years which signals to me that student loans also play a huge role in to the mid-30's. Those that have purchased homes still owe money on their student loans but have married and having a dual income household is what has enabled them to have become home owners. The "1" from the "all but 1" mentioned is single, a principal of a high school, and is renting. He hopes to have enough saved to purchase his first home later this summer.

I may be an exception to the rule but I appear to be the only one of my peers that was lucky enough to put any dollars towards retirement. I've been able to contribute 12.5% of my pre-tax salary into a 401k and my company has contributed up to 12% annually, although in the last 5 years I think that has been scaled back to 7-9% based on the economy -- still a fantastic opportunity.

Although at times I regret not have made use of my G.I. Bill and earned a college degree, I'm comforted that saving early in life isn't making me stress about retirement. Then again... I haven't had kids yet and as soon as we start I'm sure I'm going to have to scaled down on my retirement contributions.