The United States is failing to prepare but is nonetheless set to
witness the world's “greatest retirement crisis,” warns Forbes
contributor Edward Siedle.
People are living longer, but there are growing indications that many can’t afford to live comfortably in their golden years.
Findings from the Employee Benefit Research Institute (EBRI) reiterate
the harsh reality reported in other surveys: Americans do not have
enough money to retire.
Editor's Note: Economist Warns: ‘Money From Heaven a Path to Hell.’ See Evidence.
According to EBRI, more than half of U.S. households possess less than
$25,000 in savings and investments when their homes and pensions are
excluded from the picture.
Many have no pension to consider in the first place, as the trend of
extending these benefits is evaporating. And those that are so lucky to
receive them better watch out.
“Whether you know it or not someone is busy trying to figure out how to
screw you out of your pension,” Siedle writes. He warns that those funds
may not survive as long as those receiving them.
He considers 401(k)s, which were marketed as placing people's futures in
their own hands, as a great experimental disaster. Siedle, who was once
employed as mutual fund legal counsel, said the way retirement funds
were sold to working Americans is “almost laughable — if the results
were not so tragic.”
The financial status of Americans is so grim that EBRI said if an
unexpected need for $2,000 arose in the next month, only half of U.S.
households could find the money.
And, though there is much focus on Social Security and its importance to
the aging, it is often overlooked that these benefits were designed to
be supplemental income.
Whereas many interpret a crisis as a flood of tragedy, Siedle said the problem for retirees would come in “waves.”
As we are already seeing, many older people have had to return to work
because they either could not afford the costs of living or they need
employer-subsidized healthcare. Others realize they need more money so
they work longer, considering themselves to be postponing retirement.
But many Americans have put ideas of retirement aside and plan to work
as much as they can for as long as they can.
In the end, most people will end up in the same boat, according to
Siedle — with deteriorating health, a lack of employment opportunities
and insufficient funds.
“Too frail to work, too poor to retire will become the new normal” for
the majority of the nation’s elders, he explains, noting that the
problem will be too big for the nation to ignore.
Editor's Note: Economist Warns: ‘Money From Heaven a Path to Hell.’ See Evidence.
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