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
Selling your home for hundreds of thousands more than you were planning to does wonders for your HUGH nest egg.
>Did you ever pay a 90% top marginal tax rate?<
Anybody who pays top rate isn’t doing much planning ahead.
Hmmm...
So if the boomer sells his home in Indiana, and moves to Florida, he'll be able to buy that retirement home cash and have a HUGE nest egg?
Proud _USA_ Republican don’t cut it with me. What you are is a socialist idiot. You think everybody’s got a big house nestegg? you can shove it where your nestegg don’t shine !!!
Bravo Sierra. I am a boomer and have paid in the max rate for over 40 years. I would be more than happy to have no retirement if the government would just give my money back at a compounded rate of what the New York Composite Index returned over the last 40 years. I have also paid into 401ks and other plans. I will retire moderately comfortably. I will not retire in the manner that I could have it the government stayed the hell out of my retirement plan.
In California, New York, New Jersey, and Florida, 20 percent of home buyers last year were new to this country. The top five surnames of home buyers in 2000 were: Smith, Johnson, Brown, Williams, and Miller. Five years later, Smith, Johnson, and Williams were still in the top five, joined by Garcia and Rodriguez. In California, in 2005, the top five surnames among home buyers were all Latino.
This trend will not just continue in the gateway cities, but will spread out into the rural areas as well.
Hmmm...
So if the boomer sells his home in Indiana, and moves to Florida, he'll be able to buy that retirement home cash and have a HUGE nest egg?
But everyone doesn't live in California or New York..
What about everyone else?
He\she \it don’t know what they are talking about. They only know what their liberal little freak masters tell em to think !!!
I’m starting to wonder.
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.
Not only will they be buying much smaller homes, but if not homes, condos or townhomes. How many people have you heard of retiring, and selling their home for a bigger, more expensive one? Come on, be honest. The number is very small compared to those that downsize into something smaller and cheaper will less maintenence.
According to the article that I was commenting on; you are in the minority.
When the government takes 40% of your earnings, what do you expect?
Let me get this straight, if the boomer in Kansas, or Indiana etc, sells his home, he'll be able to move to Florida, buy his retirement home cash and have a HUGE nest egg? And you said earlier that it will be illegal aliens who purchase all the boomers homes...
So tell me, when Mr. Boomer sell his home in Alabama for hundreds of thousands more than he paid, and moves to Florida to retire...Didn't the homes also go up in value in Florida too?
Amen, Obie Wan.
good. liberal babyboomers owe a debt until their grave.
Of course not—the “ME” generation expects “US” to take care of them.
You better wonder if you’ve got any income because the government otherwise know as “Big Brother” will be looking for it REAL close !!!
Nothing can wreck an asset profile like splitting it up and feeding the lawyers.
The traditional pension plan went by the boards for many, and a lot of little companies did not offer an alternative.
That left a generation trying to figure out a roadmap to financial security and make a paycheck as well.
The ones who follow will be more savvy and less subject to the scams their predecessors weathered.
In the future, other paradigm shifts will occur which will increase the debt load of the younger generations, in fact some already have.
At least we could work on the cars we had as kids...
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