A quarter of U.S. workers are changing their retirement planning due to surging costs for necessities, according to the BMO Harris Bank Real Financial Progress Index released Tuesday (May 31).
The data was based on a survey of 3,407 U.S. adults between March 30 and April 25.
Other findings include that 36% of U.S. respondents have reduced their savings rate and 21% have reduced savings for retirement.
“Prices across the board – from cars and gasoline to groceries and other everyday essentials – are rising at the fastest pace since the 1980s,” Paul Dilda, head of consumer strategy for BMO Harris Bank, said in a prepared statement.
“Consumers must think differently about their finances in this inflationary environment,” he continued, advising that consumers seek advice from experts. “By learning about what do to differently, and what not to change, during a period of inflation, consumers can maintain momentum toward their financial goals.”
The survey found that among respondents, rising prices have led to 42% are shopping differently for groceries; 46% are reducing dining out or cutting back on expenditures when they dine out; 31% are driving less; 23% are cutting back on, or canceling, vacations; and 22% are reducing memberships and subscriptions.
Women are making more changes than men are, according to the survey, and younger workers are feeling more pain than older workers.
Data from the U.S. Bureau of Labor Statistics indicates that prices are surging for necessities and for broader buckets of goods. Inflation has been rising dramatically since February 2021.
Also leading to the worries of some retirees has been recent turmoil in U.S. equity markets.
The S&P 500 closed Tuesday at 4,132.15 — a decline of 15% from 4,766.19 at the beginning of the calendar year. The tech-heavy Nasdaq closed a 12,081.39 — down 31% from 15,832.80 at the beginning of the calendar year.