Our Next Big Crisis Will Be a Retirement Crisis

Barb Wire

Writes Brett Arends at marketwatch.com:

Remember how everyone sensible knew the housing market was in a bubble 10 years ago but nobody really focused on what that would mean? I wonder today if we are in a similar situation regarding retirement.

Everybody sensible knows we are facing a looming retirement crisis. Tens of millions of baby boomers are starting to retire. They are going to live in old age far longer than previous generations. Tomorrow’s grandma is going to need medical care and nursing care beyond the imagination of grandmothers of yore. Yet so few people or families have saved anywhere near enough. And our public safety net is poorly managed, ill-thought-out, and threadbare.

The National Center for Policy Analysis adds:

The United States could be facing a retirement crisis similar to the housing market crisis, says MarketWatch.

Anyone can look at the state of retirement today — tens of millions of baby boomers retiring combined with increasing longevity, too little savings and a threadbare public safety net — and see that it is in trouble, yet Americans seem intent on ignoring it and hoping for the best.

Three new reports paint a frightening picture for the future.

  • An analysis by Natixis, a money management firm, looked at a broad array of factors (from economic factors to health care) and found that the United States ranked 19th in the world for retirees, behind most other leading developed nations.
  • The Boston College Center for Retirement Research updated its “National Retirement Risk Index,” which seeks to assess how many people can expect to be financially comfortable in retirement. Half of the United States, according to the index, risks being unable to maintain their current standards of living in retirement.
  • The Employee Benefits Research Institute (EBRI) recently found that 43 percent of baby boomers and those in Generation X are at risk of running out of money in retirement. For those in the poorest 25 percent, that figure rises to 83 percent. Moreover, EBRI used the most positive financial scenarios to calculate these figures. And an earlier survey by the institute found that 66 percent of American workers had saved less than $50,000 for retirement, while 28 percent had saved less than $1,000.

Read more: NCPA

Trending: Feinstein Guilty of Violation of Federal Act

…and more: MarketWatch.com

The opinions expressed by columnists are their own and do not necessarily represent the views of Barb Wire.

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