(Bloomberg News)  More than a quarter of U.S. workers said they're "not at all confident" about their ability to afford a comfortable retirement, the highest percentage in two decades, according to an Employee Benefit Research Institute report.

"We're getting the most pessimistic results we've ever seen," said Jack VanDerhei, EBRI's research director and coauthor of the study released Tuesday.

"Those that are not well prepared are finally starting to get it. The bad news is they're not really reacting to it yet," VanDerhei said in an interview. "Hopefully this will be something that in the future will generate more savings."

About 27 percent of workers lacked confidence about their retirement savings, up from 22 percent last year. The increase was driven by those with less than $100,000 in savings, according to the report. The percentage of those with less than $25,000 in savings who are not at all confident about having enough in retirement rose to 43 percent in 2011, up from 19 percent in 2007. For savers with more than $100,000 it was 5 percent, about the same as 2007.

EBRI worked on the study with research firm Mathew Greenwald & Associates Inc. About 1,000 workers and 250 retirees age 25 and older were interviewed by telephone in January for the survey, which EBRI has conducted for 21 years.

$500,000 Needed

About 39 percent of workers think they'll need at least $500,000 by the time they retire to live comfortably, while 31 percent think they can get by with less than $250,000, according to the report.

More than half, or 56 percent, of workers surveyed had less than $25,000 in savings and investments, excluding their primary residence and any defined benefit pension plan, the study said. About 42 percent estimated their retirement savings needs "by guessing," said EBRI, which researches employee benefits. The Washington-based nonprofit has a database of more than 20 million participants in 401(k) retirement plans.

"People were shell shocked to some extent by what was going on in 2008 and 2009," said VanDerhei. "Many people wouldn't even open their 401(k) statements when they came every quarter because they were too afraid to look."

Now individuals are trying to figure out if they have enough money saved and are getting informed about whether they're on target, he said.

Online Advice

Workers should use online tools such as EBRI's "Choose to Save" calculator, make a savings plan and implement it through contributions to a 401(k) retirement plan with their employer or by opening an individual retirement account, said Greg Burrows, senior vice president of retirement and investor services for Des Moines, Iowa-based Principal Financial Group, one of the report's underwriters.

Sixty-eight percent of savers said they could save $25 more a week for retirement, which was a positive finding in the study, Burrows said. Principal has 3.4 million participants in retirement plans.

Average balances of 401(k) accounts rose to $71,500 at the end of last year, up about 11 percent from the end of 2009, according to Fidelity Investments. The Boston-based mutual-fund manager is the largest provider of the accounts with about 11 million participants in defined-contribution plans.

Redefining Retirement

High unemployment rates, government budget woes, rising health care costs, lower investment returns and questions about the funding for Social Security and Medicare are forcing Americans to redefine retirement, VanDerhei said.

Regulators and legislators also are looking at the risk of Americans outliving their savings as life expectancies increase and funds have shifted from traditional pension plans to defined-contribution plans such as 401(k)s.

The Labor Department held a hearing in September examining whether it should be easier for employers to add annuities to retirement accounts. In February senators including Jeff Bingaman, a New Mexico Democrat, re-introduced legislation that would require 401(k) plan sponsors to inform workers of the projected monthly income they could expect at retirement based on their current account balance.