May 16, 2025
Making contributions, automating savings and spending extra money wisely can help boost retirement savings.
New data shows that economic and market uncertainty fueled by tariffs is hurting the ability of Black Americans to save for retirement more than other groups.
Some 43% of Blacks are more inclined to have accessed their employee-sponsored retirement plan benefit, compared to 27% for whites and 4% for Hispanics. Thirty-eight percent of Blacks now want to save extra money for a possible emergency, versus 23% of whites and 22% of Hispanics.
The findings were provided to BLACK ENTERPRISE tied to a fresh survey by the health, wealth, and investment firm Voya Financial. Some 520 American adults working full-time and eligible for benefits were questioned, including 13% of Black respondents.
The research overall disclosed how tariffs are silently fueling a financial dilemma for U.S. workers. Most expect tariffs to spark an extensive recession and higher unemployment, and perhaps lead to price increases on goods being indirectly impacted.
The tariffs imposed by President Trump are forcing Americans to reduce their savings and make other drastic changes to improve their finances. Interestingly, 21% of Blacks are moving investments to cash accounts, compared to 13% of respondents.
Based on another report, Kerry Sette, vice president and head of consumer insights and research at Voya, shared how critical it is to have a retirement plan during uneven times.
“Market volatility, policy changes, regulatory shifts, and fluctuating investor sentiment can create uncertainty, but maintaining a steady retirement savings and investment strategy is key.”
A bright spot is that there are multiple moves Black Americans can consider using to help elevate their retirement savings, based on research by BLACK ENTERPRISE:
Start contributing immediately to retirement.
If you’re starting to stash money for retirement, start saving as much as you can now. That can help you compound interest, potentially allowing your assets to generate their own earnings through such means as reinvestment.
Give toward your 401(k).
If your employer offers a traditional 401(k) plan and you qualify for it, it may allow you to contribute pre-tax money that can be significantly beneficial. You can boost your 401(k) account if you have one, even if you started working or are a seasoned investor. Experts advise reserving around 15% of your income and trying to raise your contribution by 1% each year.
Meet your employer’s match.
If your job matches your 401(k) plan contributions, be sure you pitch in at least enough to take full advantage of the match. For instance, an employer may offer to match 50% of employee contributions up to 5% of your salary. That purportedly means if you earn $50,000 a year and contribute $2,500 to your retirement plan, your employer will kick in another $1,250. This could basically be free money you can take advantage of.
Automate savings.
Consider making retirement contributions automatic monthly. This move can potentially grow your retirement savings without you having to think about it. Be sure to check with your employer to see if they offer this option, as several reportedly do.
Select investments sensibly.
When planning for retirement, being mindful means choosing investments that align with your risk tolerance and time frame to help support growth. Perhaps diversify your investments across asset classes like stocks, mutual funds, and real estate to mitigate risks. Ask what fees are tied to your investment options and monitor market conditions that could impact your investment plan.
Pull back from early withdrawals.
Stay clear of this premature approach from plans such as 401(k)s and IRAs, as it can harm future retirement funding. It can come with penalties and taxes, trim retirement savings, and possibly weaken potential investment growth and compounding returns.
Reduce debt.
Examine where you can cut expenses. For instance, maybe bargain for a smaller payment on your car insurance, eat out less, and eliminate subscriptions. The savings could help boost your retirement plan contributions, making the golden years more lucrative. Data shows hiking your contribution from 4% to 6% could add over $110,000 to your nest egg over 30 years, assuming a $50K salary.
Keep working.
This would give you more income and time to save for retirement.
Use extra money prudently.
Don’t lavishly spend extra money you might gain, whether from a job raise, tax refund, inheritance, or a bonus. Alternatively, use the surplus cash to build your retirement kitty. And consider putting the money into an account with tax advantages to maximize your savings.
Tap into resources to get expert help.
Don’t be afraid to contact qualified professional experts, such as a financial planner, tax specialist, and estate planning specialist, to build a retirement plan to help you reach your goals. Do online research to get more help, including checking out this site and another one here.
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