Retirement Turns Into a Rest Stop as Benefits Dwindle

[mrbowler]

Good Read...Had some interesting stats. I do think that raising the retirement age on social security might be a good choice-since it would most likely also raise the age in which employers would employ age discrimination..somehow have to figure out the health care situation for those caught in between-if not IMO just heading closer to National Health Care.

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"Since the mid-1990's, older people have become the fastest-growing portion of the work force. The Labor Department projects that workers over 55 will make up 19.1 percent of the labor force by 2012, up from 14.3 percent in 2002."

"Policies promoting longer working life could ameliorate some of the potential demographic stresses," Alan Greenspan, the Federal Reserve chairman, told a conference of economists and policy makers in Jackson Hole, Wyo., last year. "Early initiatives to address the economic effects of baby-boom retirements could smooth the transition to a new balance between workers and retirees."

"As recently as 1979, the Center for Retirement Research at Boston College found more than 80 percent of the workers covered by a company retirement plan had a defined-benefit pension. By 2001, the percentage had dropped to a little over 40 percent."

"In 1988, two-thirds of all large employers offered health benefits to retirees; last year only about one-third did. And employers who offer coverage are forcing workers to shoulder more of the cost. In 2004, 79 percent of them increased their retirees' premiums"


Here's a perfect example why if you privatize ss accounts you should have some strict limits:

"Mr. Janson is also suffering because he put most of his retirement savings into Lucent stock. Shares he bought at $80 are now trading at less than $4 and his nest egg - worth about $700,000 in 1999, he said - is now less than $150,000."

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"For Americans heading into retirement, the contrast to the previous generation is stark. The typical household headed by a 47- to 64-year-old is poorer today, in constant dollars, than a similar household was in 1983. The main reason is the disappearance of the traditional pension, according to Edward N. Wolff, a New York University economist who analyzed Federal Reserve wealth data."

[crazytimes]

Too bad for Mr. Janson. Guess he didn't get the memo about diversification.

[mrbowler]

Originally Posted by crazytimes

Too bad for Mr. Janson. Guess he didn't get the memo about diversification.

I agree, but it does go to show you how people can make poor choices. I'm all for having folks make choices, and live with the consequences, but you also don't want a large segment of your retired folks on the streets. Heck if your looking to increase earnings for retirement you could simply shift a small percentage away from bonds to say a low expense Index Fund which invests in SP500 stocks. This will give you a better return(based on long term historical data).