Excuse No. 1: I can't afford to save
In the EBRI survey, the top reason workers gave for not contributing (or not putting in more) to their employer's retirement plan was that their living expenses were too high. Forty-one percent of eligible workers cited this factor for their lack of participation.
But Brian Plain, a CFP professional in Oak Park, Ill., thinks they have their spending strategy backward.
"Young workers need to think about paying themselves first and then work out the rest of their budget, not the other way around," Plain says.
Garth Scrivner, senior investment counselor with StanCorp Investment Advisors in Albuquerque, N.M., says his firm gives the same advice to clients.
"We sit down with people and try to make sure that they have a budget and a cash-flow plan that starts with retirement savings," Scrivner says. "Then they have what's left over to spend on life."
For those who have cut their spending budgets to the bare bones and still struggle to save money for retirement, Plain suggests looking for ways to acquire more income.
"That might mean considering a side job or working on freelance projects," Plain says.