More than half of American households with wage earners haven't saved a penny for retirement, according to a survey by Merrill Lynch & Co.

The brokerage house's fifth annual retirement planning survey found that 46% of preretirees (people 45 to 64 years old) and 35% of those 25 to 44 are saving for retirement.

"The crisis is getting to be worse," said John L. Steffens, who is executive vice president of Merrill Lynch's private client group.

Many middle-aged people say they don't expect to get much out of Social Security, but "the fact is they are not doing much about it," Mr. Steffens added.

Women Less Prepared

Indeed, those who bother to save at all are setting aside less and less of their earnings for the future: from 14% in 1989 to just 8%.

The survey, conducted in January and February, encompassed 800 people, evenly split between the two age groups.

The survey also found that women are less prepared than men for retirement. They start planning later, earn less, and live longer.

Only 46% of women respondents said they started saving for retirement before the age of 40, compared to 67% of men.

More than men, women say they are saving for other goals, such as children's education, homes, cars, and travel.

In January, Merrill Lynch released a study of those in the 25-to-44 age group that found they are saving just one-third of the amount necessary to maintain their standards of living after retirement.

Lack of Focus

Americans must plan for the future, Mr. Steffens said. They should make better use of 401 (k) plans and begin saving while they are younger to capitalize on the power of compounding interest.

The survey showed that 48% of the older group and 58% of the younger group believe they could save twice as much for retirement if they focused on the issue.

"I think people have just not thought about this," Mr. Steffens said.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.