From the abstract:
There is convincing evidence that millions of Americans are not prepared for, or even aware of, what is needed for a successful retirement. Baby boomers in particular are approaching this time in their life much differently than previous generations. Issues such as increased longevity, health care costs, solvency of the Social Security system, inflation and uncertain long-term care costs make assessing future retirement needs more challenging than ever before. Without dramatic changes in behavior, a large percentage of 78 million baby boomers and those who follow them will not be able to retire in the same way as their predecessors and many may ultimately need to rely on federal, state and local governmental assistance programs to help them make ends meet. At the same time, due to increasing costs and the economic climate over the past decade, state and local governments (public sector employers) are now struggling to meet their current and future pension obligations in the same way the private sector has been experiencing for years. According to a March 2012 report by the National Conference of State Legislatures, from 2009 through 2011, 43 states enacted major changes in state retirement plans to address long-term funding issues. These changes were designed to reduce pension fund obligations by increasing employee contributions or age and service requirements for retirement, or both, and adjusting benefit provisions in various other ways to reduce costs. Although many states have been unwilling to abandon the traditional defined benefit plan structure, several states now have private sector-like optional defined contribution plans or hybrid plans with a defined benefit and defined contribution component. As millions more state and local government employees (public sector employees) begin to share the retirement savings and investment risks with their employers, it’s time to learn from the early failures and eventual successes of the private sector plan model. …
– 57 percent of workers report the total value of their household’s savings and investments, excluding the value of their primary homes and any defined benefit plans, is less than $25,000.
– Only 13 percent of workers say they are “very confident” they will have enough money to live comfortably after retirement.
– About 46 percent of unmarried elderly persons rely on Social Security for 90 percent or more of their income.
– More than 75 percent of plan sponsors say most of their participants will have to work during their retirement.