Getting retirement saving back on track after job loss  

The Pew Research Center found 28% of workers over age 50 either lost a job or someone in their home did during the pandemic.

As most Americans are behind on saving for retirement, job loss can make it difficult to make that money up.

The pandemic is forcing many older workers into early retirement, though many are not financially prepared for it.

"A lot of severance packages, and early retirement so to speak," said RIA Advisors' Lance Roberts.

Roberts says he's hearing from more older workers forced into early retirement during the pandemic and needing retirement investment strategies.


"When we look at 401k plans across the board, the average savings are about $55,000 to $70,000 on average, some are more, some are less.  But that's the average, and that's not nearly enough to retire on," he said.

His advice:  don't count on the stock market alone to save you.

"What does work for a lot of individuals saving for retirement is to think about reducing debt.  Really living within their means, setting up a savings program, to where you can save 15% or 20% of your income on an annual basis," explained Roberts.


Even for workers who haven't lost their jobs, a new Rice University study reveals many investors have chosen the wrong target-date retirement funds because they have what's called a "zero bias."

"The main finding we get is that people tend to buy zero ending funds, 2040 or 2050, rather than 2045 or 2055," said Dr. Ajay Kalra of the study published in the Journal of Consumer Research.

They found investors born in years ending in 8 or 9, said Kalra, "for example, people born in 1978, 1979, they tend to buy funds that are earlier, by that I mean that they'll retire around the age fo 60."

He says funds targeted to mature before you actually plan to retire will be less aggressive and can sharply reduce your end result.

"So people who tend to buy the earlier ending funds tend to end up with less money by the time they retire and similar.  People who buy earlier funds end up 14% to 20% poorer," said Kalra.

He says now is a good time to reconsider your choice of fund.
Nerdwallet and Bankrate offer calculators to help you determine how much you should be saving for retirement.

RIA Advisors is holding a free webinar to answer your retirement questions on Saturday from 9 a.m. to 11 a.m. You can register here.