Economy

eridani

(51,907 posts) Wed Dec 23, 2015, 07:08 AM Dec 2015

Dean Baker: Your Retirement Prospects Are Bleaker Than Ever

http://www.commondreams.org/views/2015/12/21/your-retirement-prospects-are-bleaker-ever

The vast majority of Americans who expect to retire in the next decade can count on little income other than their Social Security. This is true not only for low-income workers, who have struggled most of their lives, but also for millions of middle-income workers. Although Social

Security is a tremendously important program, and provides a solid base that retirees can depend upon, its $16,000 average annual benefit doesn't go very far. Many if not most can expect to see sharp reductions in living standards.

The reason for such bleak retirement prospects is the disappearance of traditional defined benefit pensions and the failure of 401(k)-type plans to fill the gap. A recent analysis by the Employee Benefit Research Institute found that, in 2011, only 14% of private-sector employees participated in a defined benefit pension plan. The participation rate has been falling quite rapidly, so it was almost certainly lower in 2015.

Although many people were hopeful that 401(k)s would be sufficient to support a comfortable day-to-day retirement, this has proved not to be the case. In 2013, the middle fifth of households of people ages 45 to 54 had less than $60,000 in total financial assets. And most homeowners in this age group still had less than 40% equity in their homes, meaning they could look forward to paying off a mortgage well into their retirement.

10 replies

= new reply since forum marked as read

Highlight:

Dean Baker: Your Retirement Prospects Are Bleaker Than Ever (Original Post) eridani Dec 2015 OP

It did not escape notice that our retirement 401-ks were stolen by the companies dixiegrrrrl Dec 2015 #1

Yes. And Hillary Clinton warned them to stop it while taking big speaking fees from them! JDPriestly Dec 2015 #8

401Ks just another huge scam pulled on us Teamster Jeff Dec 2015 #2

Precisely Sherman A1 Dec 2015 #6

ERISA Nixon era. JDPriestly Dec 2015 #9

The Democratic Candidates Need To Put A Major Focus On This Retirement Issue.... global1 Dec 2015 #3

Read what Hillary said about Social Security v e r y carefully. antigop Dec 2015 #4

Hmmmm.... Weasel Words...... global1 Dec 2015 #5

She is not to be trusted on this issue. JDPriestly Dec 2015 #10

I agree the R word should be central to the dem campaigns wordpix Dec 2015 #7

dixiegrrrrl

(60,010 posts)

1. It did not escape notice that our retirement 401-ks were stolen by the companies

Reply to eridani (Original post)

Wed Dec 23, 2015, 07:57 AM

Dec 2015

via the crash in 2008.
Perfect timing, just before we needed the money that we had saved and that companies were "holding onto" for us.
Perfect example....my major fund was in a mandatory AIG annuity.
and in 2009 the Fed bank ( which is a PRIVATE company controlling our money) made sure we would never gain any interest on savings.

Without major serious reform of the financial system in this company, people would have to be crazy to keep their money in the current system.

JDPriestly

(57,936 posts)

8. Yes. And Hillary Clinton warned them to stop it while taking big speaking fees from them!

Reply to dixiegrrrrl (Reply #1)

Thu Dec 31, 2015, 09:59 AM

Dec 2015

Enough said.

But I will say more. We need banking and financial setor reform that protects small investirs.

Teamster Jeff

(1,598 posts)

2. 401Ks just another huge scam pulled on us

Reply to eridani (Original post)

Wed Dec 23, 2015, 09:22 AM

Dec 2015

They we're created to generate fees for Wall Street.

They also were created to give companies an escape from pension obligations.

The final move is to privatize social security

Sherman A1

(38,958 posts)

6. Precisely

Reply to Teamster Jeff (Reply #2)

Mon Dec 28, 2015, 07:58 AM

Dec 2015

I believe that the 401k idea could be a good thing and I am okay with mine, but I also have a defined benefits pension as well. I think they should be one leg of the 3 legged retirement stool and not a replacement for defined benefits programs and they should also be automatic enrollment when you hire on to a company.

JDPriestly

(57,936 posts)

9. ERISA Nixon era.

Reply to Teamster Jeff (Reply #2)

Thu Dec 31, 2015, 10:00 AM

Dec 2015

global1

(25,253 posts)

3. The Democratic Candidates Need To Put A Major Focus On This Retirement Issue....

Reply to eridani (Original post)

Wed Dec 23, 2015, 09:37 AM

Dec 2015

The 'baby boomers' are facing this head on and it is scary and not pretty. Bernie might be the only candidate that is kind of touching on this but I don't think that he's ever mentioned the 'R' word (retirement) when he talks about Wall Street and the Banksters. All three Dem candidates need to focus on the 'R' word as that will bring along the boomers under their umbrella.

antigop

(12,778 posts)

4. Read what Hillary said about Social Security v e r y carefully.

Reply to global1 (Reply #3)

Wed Dec 23, 2015, 01:04 PM

Dec 2015

http://www.democraticunderground.com/1251678744

global1

(25,253 posts)

5. Hmmmm.... Weasel Words......

Reply to antigop (Reply #4)

Wed Dec 23, 2015, 03:18 PM

Dec 2015

there is an easy solution for all - "Raise The Cap".

JDPriestly

(57,936 posts)

10. She is not to be trusted on this issue.

Reply to antigop (Reply #4)

Thu Dec 31, 2015, 10:03 AM

Dec 2015

Them's weael-words.

wordpix

(18,652 posts)

7. I agree the R word should be central to the dem campaigns

Reply to global1 (Reply #3)

Tue Dec 29, 2015, 01:13 PM

Dec 2015

So many people I know are in their 60's or 70s and have very little to show for a lifetime of work. But gawd forbid we should shut down the richies' tax havens and tax them more.

Reply to this discussion