Sunday, October 03, 2010

Retirement Crisis Percolating Up Into General Awareness

For a while not it has been clear that the United States is headed toward a retirement crisis. Between the low/negative savings rate, disappearance of pensions, decline in housing values and down stock market, it seems clear that the majority of people under 50 (maybe most people working now, period) are not going to be in a good position to retire. The only silver lining to this is that I think there is a lot of evidence that retirement is not so good for people (especially men). So it might not be such a tragedy if people had to keep working into their 70s, and beyond.

There are a few tricks to making this all work. First, of course, is to have an occupation where it is viable to keep working; i.e., not a physically demanding one. Second, is to keep one's self mentally and physically fit to keep working. Third, is for the workplace to adapt, to offer subtle gradations of serious part-time work.

Anyway, NPR Marketplace had a couple of stories on the topic that made me perk up and listen. The first was about people who could easily afford to retire, but had no intention of doing so. It was definitely skewed to the upper-middle class, but it was interesting to hear. The second had more mass-market relevance, it was an interview with the CEO of TIAA-CREF, on the topic of retirement unpreparedness. He under-played it a bit, in my opinion--likely because he doesn't want to scare people into giving up--but generally painted the same picture of generations with no hope of full retirement.

Ideally, the message people would hear (I don't know who would transmit the message) would be:

  • Save as if you were trying to retire
  • Maintain your physical health, vocational skills, and adaptibility as if you were never going to retire
There are two problems with that notion, though. One, like so many other much-needed "messages", I have no idea who would actually deliver it. I.e., who would speak  to the American people, authoritatively and as if they were grown-ups. Two, there is the risk that people will hear the second part, and conveniently give up entirely on the first part.

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