Wake Up, Washington: Workers’ Retirement Deficit Hits $6.6 Trillion
If you are between ages 32 and 64 and hope to maintain your current standard of living when you retire, you are part of a group that is $6.6 trillion in the hole.
That is the nation’s retirement deficit, according to the Center for Retirement Research at Boston College.
That mind-boggling shortfall takes into account all major sources of retirement income and assets: Social Security, traditional pension plans, 401(k)-style plans, and other forms of saving, and housing. But half of the workforce has neither a 401(k) nor a pension to supplement Social Security.
Retirement USA, a coalition that includes the AFL-CIO, is spearheading a “Wake Up, Washington” Month to encourage Americans across the country to tell lawmakers to keep their hands off of Social Security and to fix our patchwork private retirement.
The frightening aspect of the $6.6 trillion retirement deficit is that figure may become worse because all those sources of retirement income are under attack. Says Maria Freese, director of government relations and policy for the National Committee to Preserve Social Security and Medicare:
Cuts to Social Security, pension freezes and 401(k) losses on the stock market could easily make the Retirement Income Deficit much, much worse in the future.
Social Security is in the crosshairs of the federal budget deficit commission, where raising the retirement age, cutting benefits or even privatizing Social Security could be recommended when its report is released in December.
On the 401(k) front, AFSCME Secretary-Treasurer Lee A. Saunders writes on Huffington Post that
individuals who have been left on their own to save for retirement in 401(k) accounts face challenges that are not being met. As a result of the financial crash that led to the worst economic crisis since the Great Depression, the retirement savings of most baby boomers—which were already inadequate—were reduced to levels that may create genuine impoverishment as the boomers retire and enter their 70s.
Fewer and fewer workers are covered by traditional pension plans and the collapse of housing prices has gobbled the equity that many working families counted toward their retirement preparedness.
Visit Retirement USA to find out how you can make your voice heard.