Many have raided their retirement accounts to pay bills. In the United States, 26 percent of workers with 401(k) and other defined-contribution plans take loans or make hardship withdrawals before they reach retirement, according to a study by HelloWallet, which offers online services that help people with their finances. Working Americans withdraw $70 billion annually from retirement accounts — an amount that's 40 percent of the $175 billion put in. Employers add an additional $118 billion.
Retirement specialist Teresa Ghilarducci of the New School for Social Research in New York says the voluntary plans "work for a robot with an Excel spreadsheet," not for people trying to pay bills and care for children who aren't thinking decades ahead to retirement.
NUDGING WORKERS TO SAVE
Several countries are trying to force — or nudge — workers to save more for retirement.
Australia went the furthest, the soonest. It passed a law in 1993 that makes retirement savings mandatory. Employers must contribute the equivalent of 9.25 percent of workers' wages to 401(k)-style retirement accounts. (The required contributions will rise to 12 percent by 2020.) Australians can't withdraw money in their accounts before retirement.
When politicians were debating the plan, only about half of Australians supported it. Within six months, approval rose to 85 percent. The difference: Workers started receiving statements that showed retirement savings piling up, says Nick Sherry, who helped design the program as a cabinet minister.
In October 2012, Britain required employers to start automatically enrolling most employees in a pension plan. At the start, contributions must equal at least 2 percent of earnings, half provided by employers. By 2018, contributions must rise to 8 percent, of which 3 percentage points will come from employers.
In 2006, the United States encouraged companies to require employees to opt out of a 401(k) instead of choosing to opt in. That means they start saving for retirement automatically if they make no decision.
EASING THE PAIN
Rebounding stock prices around the world and a slow rise in housing prices are helping households recover their net worth. In the U.S., retirement accounts — defined-contribution and defined-benefit plans combined — hit a record $12.5 trillion the first three months of 2013, according to the Urban Institute. They've gone higher since.
However, net worth is merely climbing toward a level considered inadequate at its peak in 2007. Boston College's Center for Retirement Research says the recovery in housing and stock prices still leaves 50 percent of American households at risk of being unable to maintain their standard of living in retirement. That's down from 53 percent in 2010 but up from 44 percent before the Great Recession hit in 2007.
Only half of all Japanese say they've even thought about how to finance their retirement. And 63 percent are counting on getting most of their income from a government pension system that's going broke.
When they look into the future, retirement experts see more changes in government pensions and longer careers than many workers had expected:
— Pension cuts are likely to hit most retirees but should fall hardest on the wealthy. Governments are likely to spend more on the poorest among the elderly, as well as the oldest, who will be in danger of outliving their savings.
— Those planning to work past 65 can take some comfort knowing they'll be healthier, overall, than older workers in years past. They'll also be doing jobs that aren't as physically demanding. In addition, life expectancy at 65 now stretches well into the 80s for people in the 34 OECD countries, an increase of about five years since the late 1950s.
"My parents retired during the Golden Age of retirement," says Mercer consultant Dreger, 37. "My dad, who is 72, retired at 57. That's not going to happen to somebody in my generation."
McHugh reported from Frankfurt, Germany, Kurtenbach from Tokyo. AP writers Bernard Condon in New York, Fu Ting in Shanghai, Youkyung Lee in Seoul and Sylvie Corbet in Paris contributed to this report.