Almost a third of American baby boomers face a poverty-stricken retirement because they have not squirreled away enough money to finance their twilight years.
Too many Americans aged between 51 to 61 are leaving themselves short financially when it comes to their retirement, and may have left it too late to make up the shortfall, a study by the Center for Retirement Research at Boston College has concluded.
"We just don't believe people are saving too much," stressed Alicia H Munnell, professor of management sciences at Boston College and director of the centre to the news agency The Associated Press.
While some studies have predicted that as many as eight out of 10 baby-boomers are financially well prepared for retirement, the Boston College study adds to a growing weight of evidence that most, in fact, are not.
A study by consultancy Aon in May, for instance, suggested that in as many as six out of 10 organisations, the majority of employees are not financially prepared for retirement.
The Boston College study looked at the finance of a 51-61 age group in 2004, and found 32 per cent were "at risk" of not being able to maintain their pre-retirement standing of living in retirement.
Munnell said Americans had two choices, both equally unpalatable, to save more money or to work longer.
For older people, "working just two years more ... can make a substantial difference" to retirement preparedness, she said.
"Working longer has a powerful effect because it shortens the period over which you have to support yourself and ... lets you put off tapping your 401(k) and collect higher Social Security benefits," she added.
The study was carried out using the centre's National Retirement Risk Index, developed with funding from Nationwide Financial.
Keith Millner, senior vice president and head of Nationwide Financial's in-retirement division, said warned of a looming "retirement crisis".
"The No. 1 issue is inertia – people aren't doing anything. They need to get educated, get engaged," he emphasises.
Young workers especially could benefit from saving more because of the impact of compounding, he said.