No matter their income level, a significant number of U.S. workers are likely to struggle to meet basic expenses during retirement, a new study of baby boomers and generation Xers released on Tuesday shows.

Over 40 percent of people with the lowest incomes face prospects of depleted savings within 10 years after retirement, with that number climbing toward 60 percent after another decade, according to Washington-based Employee Benefit Research Institute (EBRI).

For many workers, having savings in a 401(k) plan or similar retirement vehicle can make the difference between security and struggle in retirement.

How long you've been in a 401(k) plan is the number one thing showing if you'll have enough retirement income, Jack VanDerhei, EBRI's research director, told Reuters.

Higher-income workers are not totally immune to financial troubles down the road.

EBRI's retirement-readiness rating for 2010 showed that the two top earning groups face a significant, if smaller, risk of not being able to pay basic expenses and medical costs later in life. Nursing home costs sting higher earners in particular later in life, VanDerhei said.

The results are the latest wake-up call for policy-makers and households about the realities of modern retirement as millions of baby-boomers hit retirement age every year.

The warning comes despite improvements in retirement savings levels since 2006 when many employers adopted automatic enrollment guidelines for 401(k) plans, said VanDerhei.

In the last 20 years or so, many U.S. companies have dropped defined benefit pensions that pay out a regular sum in favor of plans such as 401(k)s in which a worker puts aside pretax dollars to build a retirement nest egg.

But for many workers, 401(k) balances are still relatively small.

The study's results are based on a model weighing inputs including age, income, retirement contribution tendencies, savings plan changes and employee behavior from a database of 401(k) participants.

Based on these factors, EBRI found that 47 percent of the early boomers, now 56 to 62 and nearing retirement age, are likely to exhaust their retirement savings.

Late boomers, now aged 46 to 55, and Generation Xers, defined as being between 36 and 45 years old, run roughly a 44 percent chance of running short of money.

In each case, though, the estimate of at risk individuals has fallen since 2003, when EBRI previously conducted its readiness survey.

For those on the brink of retirement, the only solution may be to keep working. But for younger workers there is still time to correct the imbalance by squirreling away more money.

In some cases, an extra five to 10 percent of compensation (put toward savings) will get you where you need to be, said VanDerhei. But you need to start now.

(Editing by Ros Krasny and Philip Barbara)

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