The Phony Retirement Crisis
"...there is no retirement crisis among either today’s retirees or tomorrow’s. Eight in 10 retirees tell Gallup they have enough money to “live comfortably,” and 6 in 10 working-age households say the same. Seventy-five percent of retirees tell the Federal Reserve’s Survey of Consumer Finances they have “at least enough to maintain [their] standard of living,” up from 61% in 1992. Census Bureau research that uses Internal Revenue Service data to measure retirees’ incomes found that the over-65 poverty rate was only 6.7% in 2012, down from 9.7% in 1990 and lower than any other age group."
So retirees live better than workers & their lots are improving.
"More Americans are saving more than ever for retirement. Participation in traditional defined-benefit pensions peaked at 39% of employees in 1973. Today, the Social Security Administration says that 61% of workers, including 80% of married couples, participate in a plan. Nonsavers are mostly low-earners, who will receive high “replacement rates” from Social Security, or young employees who will save as their earnings rise.
Retirement-plan contributions are up as well, Labor Department data show. From 1975-84, total employer and employee contributions averaged 6% of employee wages; over the past decade the average has been 8.3%. Retirement savings in employer-sponsored plans and individual retirement accounts are at record levels, rising sixfold since the mid-1970s.
Retirement incomes have risen too.
According to Fed data, the median retiree household’s income grew by 56% above inflation from 1989 through 2016, versus only 4% real growth for working-age households. Incomes grew faster at the poorest fifth percentile retirees than at the 95th percentile of the working-age population.
The Social Security Administration’s sophisticated computer models don’t project a retirement crisis. Incomes will continue to rise, old-age poverty will fall, and the share of retirees unable to maintain their standard of living will be similar to today."
https://www.wsj.com/articles/the-phony-retirement-crisis-11551398196