Retirement Age for Today's Workers is Nearing 70
February 4, 2002
It is a truism that most Americans don't save enough to retire in the manner they became accustomed to during their working years. The rising stock markets of the 1990s papered over this unpleasant fact. But with the boom gone, the new retirement age is "probably between 68 and 70," estimates Annika Sunden of Boston College's Center for Retirement Research.
- Forty percent of people who have saved for their retirement and are now 67 are still on the job -- compared with only 20 percent of the 67-year-olds with company-financed pension plans.
- The 67-year-olds were in their mid-40s when Congress, in the late 1970s, authorized tax-deferred 401(k) plans.
- That began a shift from a private-sector pension system financed by the employer toward a system mainly financed by employees and their Social Security prospects.
- While the employer-financed pensions, combined with Social Security, produced a retirement income at 65 equal to about 60 percent of pre-retirement pay for the typical worker, 401(k) savings combined with Social Security produced a typical pension, at 65, that is less than 50 percent of pre-retirement pay.
Source: Louis Uchitelle, "Workers Find Retirement Is Receding Toward 70," New York Times, February 4, 2002.
See also recent NCPA study "Reinventing Retirement Income"
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