Posted on 07/30/2007 7:31:07 PM PDT by traumer
Study Says Nearly One-Third of Older Baby Boomers Haven't Saved Enough for Retirement
NEW YORK (AP) -- Nearly one-third of baby boomers ages 51 to 61 are at risk of not having enough in savings to finance a comfortable retirement, according to a study being released Tuesday by the Center for Retirement Research at Boston College.
With its analysis, the center has joined the national debate over how much savings is enough -- and has done so on the side that says there's a shortfall.
"We just don't believe people are saving too much," Alicia H. Munnell, a professor of management sciences at Boston College and director of the retirement research center, told The Associated Press.
A recently published academic study looked at the retirement preparedness of Americans who were in their 50s in 1992 and concluded that at least 80 percent had more than enough assets for retirement. Other scientists have argued that Americans may be saving too much.
The new Boston College study evaluated the same 51-61 age group, but looked at their finances in 2004, and found 32 percent to be "at risk" for not being able to maintain their preretirement standing of living in retirement.
The difference between the results, the center said, has to do with changes in the financial environment. For one thing, Americans now must wait until they're older than 65 to collect full Social Security benefits; meanwhile, lower interest rates mean they'll probably collect less on annuities and other investments. And many of today's workers do not have pensions like the earlier generation but must rely on worker-funded 401(k) retirement accounts, the center said.
Munnell said Americans have two choices -- to save more or to work longer.
For older people, "working just two years more ... can make a substantial difference" to retirement preparedness, she said.
"Working longer has a powerful effect because it shortens the period over which you have to support yourself and ... lets you put off tapping your 401(k) and collect higher Social Security benefits," she said.
The study was done using the center's National Retirement Risk Index, developed with funding from Nationwide Financial, the long-term savings and retirement product division of the Nationwide Mutual Insurance Co.
Keith Millner, senior vice president and head of Nationwide Financial's in-retirement division, said "there is a retirement crisis" because people are living longer, health care costs are escalating and workers aren't saving enough.
"The No. 1 issue is inertia -- people aren't doing anything," he said. "They need to get educated, get engaged."
Young workers especially can benefit from saving more because of the impact of compounding, he said.
Center for Retirement Research: http://www.bc.edu/crr
Nationwide Financial: http://www.nationwidefinancial.com
no they won’t. those of us who haved planned for and sacrificed for retirement will be taxed to support these low-life selfish jerks.
According to Nicholas Retsinas, the director of the Joint Center for Housing studies at Harvard, we need to allow million of illegal immigrants into our country each year because they will eventually pool their money together and buy the homes retiring boomers need to unload. Thus keeping housing prices going ever upward, home building industry growing (one of the biggest employers of illegal labor), and the boombers can retire well. Problem solved!!!
I remember a statistic from the mid 1990s. It said the AVERAGE 50 year old had $2000 saved for retirement. I couldn’t believe it. That couldn’t be, could it? At the time, *I* had a lot more money than that in my 401K!
Then, after I switched jobs and moved around a bit, I began to realize that many of my co-workers fit this profile.
Agreed!
If the illegal aliens will be purchasing all he boomers homes, where will all the boomers be living?
Guess what is now the most heavily funded area of big pharma?
Anti-Diabetes drug development.
So they have no retirement pensions?
Did you ever pay a 90% top marginal tax rate?
I don’t know what the hell you are talking about HOWEVER I stand by my posting that we the Boomers are the most taxed generation in the history of this country !!!
Downsizing to retirement condos in places like Florida and Arizona. That will leave them with a huge nest egg to continue their level of consumerism and lack of savings.
Yeah right genius,a hugh nest egg !!!
My Brain: Many stinking lieberal regressive hippies are boomers. See a connection?
Oh, so all the boomer retirees are moving to Florida and Arizona, and the illegal aliens will be purchasing all their homes in the rest of the country. Oh, OK.
As usual, a giant argument is generated around an undefined word.
I notice no great effort is made to define "comfortable".
No mention, either, of the mortal blow to the Social Security System when welfare "Medicare" was attached to it.
Medical care is perhaps the biggest "sword of Damocles" retirees face. Medical care is now almost as inferior as the Canadian fiasco.
I agree with you, Obie.
We have been self-employed (solo architect) the last 35 years. Raised 4 children, with only one modest car. (Still only have one modest car!)
There were some really good years when we could afford to stash some away. They kept changing of the tax laws on us, and that, combined with the ups and downs of the construction industry), meant we could never keep what we had saved.
It all went to .gov! Remember, self-employed professionals get very few tax breaks for stuff like health insurance. When we lost the 5 year averaging, it really stung us!
I feel so sorry for the next generation. We will get blamed for the mess they inherit, but it really wasn’t us, but the fools in D.C.
I can't believe that nobody remembers that Billy CLinton, the First Rapist instituted the first tax ever on Social freakin Security income!
That helps.
Just saying.
I work at a bank and blows my mind how soo many co-workers have 0 retirement savings or cashed out of whatever they had saved in retirement accounts to buy real estate recently.
I’m currently in my mid-30’s and have 100,000+ in my 401K. I have maxed out yearly contribution limits to it the past 5 years taking full advantage of my companies matching. I still get scarred I won’t have enough down the road to survive when I’m in my retirement years.
I’m investing right now with a mindset that I will receive 0 social security. If I do get any, it will be a little extra each month. There is no fricken way you will be able to live off of social security and nothing else.
You bet. Many of the younger people today haven't a chance. I see many of them never being able to afford a home, even with two incomes.
I don’t expect that everyone will be as fortunate as I am. My wife and I were both well paid during our working years. Sure we were frugal, saving for the kids college and our retirement but those who are broke and subsisting on SSI are just that, subsisting. That’s not what I would call living.
You have more than my wife and I had in our 30s. Keep saving and investing, you’ll do fine.
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