It’s no secret that Americans are falling short when it comes to saving enough for retirement. But as a new report shows, many are disastrously unprepared — and that may point to flaws in the system.

Progressive think tank the Economic Policy Institute found that Americans 56 to 61 had a median balance of $21,000 in their 401(k) accounts in 2016, which is the most up-to-date data on file. That total reflects almost 30 years of savings.

Younger generations do not fare much better. Older millennials (ages 32 to 37) have about $1,000 saved in their 401(k)s.PUBLICIDAD

The problem is that while 401(k) plans are meant to supplement Social Security, the benefits distributed by the government agency are modest. Currently, the average Social Security retirement benefit is about $1,470 a month, or about $17,640 a year, according to the Center on Budget and Policy Priorities.

Meanwhile, the typical American spent about $3,900 a month last year on basics such as food, housing, utilities, transportation and health care, according to the latest consumer spending data from the Bureau of Labor Statistics. Retirement accounts, ranging from pensions to 401(k)s to individual retirement accounts, are expected to fill the gap.

But when it comes to 401(k)s, that’s not happening.

At least one economist says that the problem lies primarily with the plans, not with Americans’ savings habits. “The system is designed to make people feel bad about themselves — everyone privately thinks that they’re screwing up. And yet if everyone is screwing up, then it’s clearly a system flaw,” Monique Morrissey, economist at the Economic Policy Institute and author of the report, tells CNBC Make It.

Problems with the current system

As more and more American employers move away from offering pensions, 401(k)s and similarly structured retirement plans have risen in popularity. But the biggest problem with relying on 401(k) plans to supplement Social Security benefits is that many people simply don’t have access to employer-based retirement plans.

“The No. 1 problem is a coverage problem,” Morrissey says. Nearly 40 million private-sector employees do not have access to a retirement plan through their employer, according to a 2018 study by the U.S. Bureau of Labor Statistics.

Most people without any 401(k) savings are in that position because they don’t have access to a plan at work, often because their employer doesn’t have a plan at all, they’re part-time or they haven’t been at the company long enough to qualify.

Even if people are covered and participating in their retirement plan, Morrissey says “401(k) plans were not well designed to serve in lieu of a real pension.”

First, 401(k) plans can be difficult for employees to navigate, even with changes lawmakers have put in place to make it easier for consumers to get started. Last year, 65% of companies with more than 5,000 employees automatically enrolled workers in 401(k) plans at a small set deferral rate, according to data from Vanguard. Many times, these programs will start employees off at a 3% contribution rate and gradually increase it to 6%.

Read More @CNBC