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LIANE HANSEN, host:

Each year since 2006, Congress has declared the third week of October to be National Save for Retirement Week. But thanks to the bad economy and falling home prices, most Americans may be in worse shape for retirement than they were just four years ago.

NPR senior business editor Marilyn Geewax is here to talk about retiring comfortably. Welcome back, Marilyn.

MARILYN GEEWAX: Hi, Liane.

HANSEN: Congress wants us to reflect on retirement planning this week and I know you've been thinking about it. What have you learned?

GEEWAX: Well, I did check with some financial planning experts, and they're very worried about the outlook. For one thing, fewer employers are offering traditional pension plans. Those are the ones where retirees get a set amount of money each month, based on how long you worked for a company. Back in 1975, about 35 percent of workers could look forward to getting those monthly checks in retirement. But today, that's down to about one in four workers.

So instead of counting on those steady pension payouts, most people are really turning to the 401(k)-type plans to try to save. About 72 million U.S. workers are now enrolled in those kinds of savings plans. They're sponsored by their employers.

But even those plans are becoming a lot less attractive to workers, because a number of employers have stopped offering those matching contributions to the plans.

HANSEN: Has the bad economy actually discouraged workers from putting money into their retirement accounts?

GEEWAX: Surprisingly, no. People who have hung onto their jobs have continued to set aside money in their 401(k)s. But, Liane, here's the weird thing: More and more people are taking money out of their accounts through these hardship withdrawals.

I called the folks at Fidelity Investments, which is a big provider of workplace retirement savings plans. And they said they're seeing that about one in four people now have some kind of an outstanding loan withdrawal type thing from their 401(k).

And it looks like what we're seeing is that people really do want to save for retirement, and so they ask their employers to divert some of their wages into these savings accounts. But then, the economy is so bad, they get into trouble, maybe their spouse loses a job, the car breaks down, their credit is too low to get a loan, so they end up having to take money out of their 401(k) through a hardship withdrawal. And of course, that ends up triggering all kinds of penalties and tax consequences, so it ends up being this huge financial setback.

HANSEN: Well, this is supposed to be recovering now. Is the worst of this 401(k) borrowing over?

GEEWAX: No, in a way it's getting worse. Fidelity said that in the first three months of this year, 45,000 participants in their plans took out these hardship loans. And in the second quarter, the number jumped up to 62,000 of these hardship withdrawals. So that suggests that a lot of people have used up their savings. They can't get loans because of bad credit. And so, yes. We're in this technical recovery, but we're seeing a lot of evidence that the economy is still making it really tough for people to plan for retirement.

HANSEN: What do most people have in savings?

GEEWAX: The majority of Americans have less than $25,000 in savings. And remember that home prices are down dramatically across the board. So, you know, the idea that you can just sell your house in retirement and live off of all that home equity, that's becoming less and less true for most Americans.

And this has people clearly worrying. I talked to the Employee Benefits Research Institute, which is a group that studies retirement planning. And they say that their surveys show that four years ago, 27 percent of people said that they were very confident they could retire comfortably. Now that's down to just 16 percent.

HANSEN: Is anything being done to help people save? I mean besides reminding them once a year to do it?

GEEWAX: Well, last week, the Labor Department tried to take a step that would help a little bit. Starting in 2012, the government is going to require employers to do more to disclose what fees are being charged on these things. And also to provide performance data so that you have a better idea of which mutual fund to choose.

In other words, you, the saver, you should be able to make better decisions about how to invest and whether or not to take money out of your account. And the hope is that if you have more information, you'll make better decisions about how to invest.

HANSEN: Marilyn Geewax is NPR's senior business editor. Marilyn, thanks a lot.

GEEWAX: Oh, you're welcome, Liane.

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