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Study: Many Boomers Lack Retirement Fund
http://biz.yahoo.com/ap/070730/boomers_savings.html?.v=2 ^

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


TOPICS: Business/Economy; News/Current Events
KEYWORDS: babyboomers; genx; retirement
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To: traumer

My fiance and I work from morning until night, every night, going into debt, paying off debt, pulling in more capital, increasing salary, and pouring money into our future.

we are barely in our 30’s.... Why? Because we aren’t lazy liberal babyboomer schlepts.


61 posted on 07/30/2007 9:30:47 PM PDT by Porterville (I'm an American. If you hate Americans, I hope our enemies destroy you. I will pray for my soul.)
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To: Obie Wan

“What you are is a socialist idiot.”

How exactly is pointing out that many boomers will be retiring house rich, but savings poor in the coming years make me a socialist idiot?


62 posted on 07/30/2007 9:31:40 PM PDT by Proud_USA_Republican (We're going to take things away from you on behalf of the common good. - Hillary Clinton)
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To: PA Engineer

More companies were providing pensions back in the “old days,” that’s true. But only about 35% of workers were covered by a pension plan back in 1980. Now, about 20% are. It was never anything close to a majority.

There was AMT, but it only nailed a very few people. But marginal tax rates were much higher—and usually only the wealthiest could get the writeoffs.

FICA tax was only 6.13% back then. Now it’s 7.65. So, that has definitely been a higher burden on boomers. But it’s going to pay off for you, because you’ll actually get full benefits. Some of us whippersnappers won’t be so lucky.

I just think it’s a ludicrously inaccurate statement to say that the Boomers are THE most highly taxed generation ever, while they enjoyed the past 25 years of mostly falling marginal income and capital gains tax rates.


63 posted on 07/30/2007 9:33:21 PM PDT by Choose Ye This Day (Ask not what you can expect from life; ask what life expects from you. -- Viktor Frankl)
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To: Porterville

Seriously,can I have youe autograph ???


64 posted on 07/30/2007 9:34:11 PM PDT by Obie Wan
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To: Obie Wan

You don’t know what I’m talking about?

Really?

I thought it was a fairly straightforward question.

Did you ever pay taxes when the highest marginal rate was 90%, as it was before JFK lowered tax rates a bit? Nowadays, the highest marginal rate is 35%, thanks to Reagan and W.


65 posted on 07/30/2007 9:38:04 PM PDT by Choose Ye This Day (Ask not what you can expect from life; ask what life expects from you. -- Viktor Frankl)
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To: Publius6961
I can't believe that nobody remembers that Billy CLinton, the First Rapist instituted the first tax ever on Social freakin Security income!

According to Wikipedia, taxes on SS income began in 1984, with 50% of benefits subject to tax.

Beginning with the 1994 tax year, the portion of benefits potentially subject to tax was increased to 85%.

66 posted on 07/30/2007 9:39:08 PM PDT by Doe Eyes
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To: Proud_USA_Republican

Here’s why, You and the D’crap Party are VERY willing to point out what any free market citizen can make however you don’t have a problem with taxation of the same profit,which tells me you are a socialist !!!


67 posted on 07/30/2007 9:39:52 PM PDT by Obie Wan
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To: traumer

There seems to be a lot of anger on this thread, don’t be pissed at me anybody. I am 62 years old, born about a year too soon to be a boomer.

I have been retired for 8 years and the only government money I’ve ever seen was 4 years of active duty military pay and damn’d little of that.


68 posted on 07/30/2007 9:40:04 PM PDT by Graybeard58 (Remember and pray for SSgt. Matt Maupin - MIA/POW- Iraq since 04/09/04)
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To: OCCASparky

The would be good planning but I hate to stiff an honest businessman.


69 posted on 07/30/2007 9:40:09 PM PDT by B4Ranch ( "Freedom is not free, but don't worry the U.S. Marine Corps will pay most of your share.")
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To: Proud_USA_Republican
If home in Indiana sells for a couple hundred thousand more than what they are purchasing in Florida, than yes, that creates a huge boost in their retirement savings.

Wow, I had no idea how lucky these boomers are. Sell they're home in Indiana, buy a retirement home in Florida for cash, and have a huge nest egg left over to boot!

Can't complain there.

70 posted on 07/30/2007 9:44:00 PM PDT by dragnet2
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To: Choose Ye This Day

90%,35% what’s right you tell me. Here’s my suggestion how about 5%, being as the goverment urinates our money away anyhow !!!


71 posted on 07/30/2007 9:45:31 PM PDT by Obie Wan
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To: Doe Eyes

Yes, “potentially.”

Some SS benefits above a certain Adjusted Gross Income (AGI) are still taxed at 50%. At a higher income, 85%.

Either way, it sucks. I was taxed all along as I paid in to the system, and now as I draw money out, they tax me again? Thanks for the double dip, Congress.


72 posted on 07/30/2007 9:46:38 PM PDT by Choose Ye This Day (Ask not what you can expect from life; ask what life expects from you. -- Viktor Frankl)
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To: traumer

My retirement fund lost 7K last week. I’m STILL crying!


73 posted on 07/30/2007 9:46:45 PM PDT by FrogMom
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To: dragnet2

I wasn’t saying that every person over the age of 55 in the US is tomorrow going to put up their house for sale and move to Florida.

But there is going to be a big percentage that have to downsize due to lack of retirement savings or other less dramatic factors (they simply don’t need or want these big homes anymore), even if its rural dominated states like your basing your argument on where cost of living is much lower.


74 posted on 07/30/2007 9:48:18 PM PDT by Proud_USA_Republican (We're going to take things away from you on behalf of the common good. - Hillary Clinton)
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To: Obie Wan

I’d LOVE it. Of course, you and I know it will NEVER happen. Not in my lifetime, nor in my children’s.


75 posted on 07/30/2007 9:48:57 PM PDT by Choose Ye This Day (Ask not what you can expect from life; ask what life expects from you. -- Viktor Frankl)
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To: FrogMom

When are you retiring?


76 posted on 07/30/2007 9:49:29 PM PDT by Choose Ye This Day (Ask not what you can expect from life; ask what life expects from you. -- Viktor Frankl)
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To: Proud_USA_Republican
Selling your home for hundreds of thousands more than you were planning to does wonders for your HUGH nest egg.

What I'd like to know about what you said...

If Mr. Boomer sells to the illegal aliens in Indiana, and moves to Florida, buys retirement home cash, has a huge nest egg left over...Didn't the prices go up in Florida like his home did in Indiana?

77 posted on 07/30/2007 9:51:10 PM PDT by dragnet2
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To: FrogMom

Or are you already retired?


78 posted on 07/30/2007 9:51:30 PM PDT by Choose Ye This Day (Ask not what you can expect from life; ask what life expects from you. -- Viktor Frankl)
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To: Choose Ye This Day

You ‘re right, but it pisses me off none the less !!!


79 posted on 07/30/2007 9:52:13 PM PDT by Obie Wan
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To: traumer

Where I am many, maybe most boomers I know have the same plan.. they are big in debt on a house and counting on home price appreciation for the next 10 years. Then they’ll all cash out and have enough to retire on.

The slight problem is they all have the same plan, and the younger generation doesn’t have much money.


80 posted on 07/30/2007 9:54:57 PM PDT by ran20
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