Last Friday, Slate.com, New America Foundation, and Arizona State University hosted a series of panels discussing the implications of increasing life expectancy on public policy, retirement, and family planning.
Savings defaults, auto-enrollment, and financial literacy were hot topics. Nudges, “guardrails,” and redefining “retirement” are discussed at length.
Life Expectancy Rate and Impact on Retirement (~40 minutes)
For a Lunch Meeting with Guest Speakers:
Director of Retirement Research
Who will discuss a new paper:
“Retirement Savings Adequacy of U.S. Workers”
Location: New America Foundation
1899 L Street, NW
3rd Floor, The Classroom
Washington, DC 20036
Tuesday March 5, 2013
This analysis examines whether U.S. workers are saving adequately for retirement. The target levels of retirement savings are derived by a comprehensive consumption and savings model in a life-long planning framework. The actual wealth of a representative sample of U.S. households is computed from the Survey of Consumer Finances. Comparing the model targets with the actual savings suggests that 44 percent of workers in 2010 are saving inadequately if they were planning to retire at the normal age for full Social Security benefits; alternatively, 52 percent are inadequately prepared for retirement if they were planning to retire at their desired ages, typically younger. The prevalence of savings inadequacy has worsened, by 6-8 percent of households, compared to 2007 when the prospect of retirement looked brighter at the height of the market in the last decade. Asset value losses in retirement accounts during the financial crisis and the decline of DB coverage are significant explanatory factors.