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News about retirement since the financial crisis has been decidedly negative. Workers aren't saving enough. Pensions are underfunded. Long-term investment strategies to make up the difference are far from obvious.
But new research suggests that the state of retirement in America isn't as disastrous as thought.
Towers Watson, a global professional services company that consults on financial management, has two new studies out that provide signs of improvement.
First, the financial health of large U.S. corporate pension plans improved sharply in 2013.
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A second positive signal is that more American workers are satisfied with their finances and confident about retirement.
Nearly half of respondents (46 percent) were "satisfied" with their current finances, up from 26 percent in 2009, according to a separate Towers Watson survey. Employees' confidence in their ability to retire also continued to climb: 23 percent were "very confident" of having enough income for the first 15 years of retirement.
Of course, those results are hardly a sign that the retirement problem is solved.
About 58 percent of workers remain worried about their financial future and only 8 percent are "very confident" of having adequate income 25 years into retirement, according to the same survey.
1. Corporate pension plans are rapidly disappearing--companies are steadily switching to 401Ks. So if the stock market goes bad the retiree is going to be in bad shape.
2. A smaller and smaller proportion of the population is working for large corporations with decent wages every year.
1. Corporate pension plans are rapidly disappearing--companies are steadily switching to 401Ks. So if the stock market goes bad the retiree is going to be in bad shape.
2. A smaller and smaller proportion of the population is working for large corporations with decent wages every year.
So for those with private pension plans the improvements are there and thus better.
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The analysis found that the 100 largest public company pensions improved their funding levels by 13 percentage points, from 78 percent at the end of 2012 to 91 percent at the end of 2013. That's the best funding level since the end of 2007, when the average stood at 103 percent, according to the report.
Reasons for the improvement include rising interest rates, which lowered liabilities, and investment returns that averaged 10.8 percent in 2013.
Doesn't mean more have but it means those with are on more solid footing and that in some folks book is good. Also for those with defined contribution plans their returns have improved considerably and they are feeling better as the article indicates and that for them is good and is reflected in the improving stats.
Quote:
A second positive signal is that more American workers are satisfied with their finances and confident about retirement.
Nearly half of respondents (46 percent) were "satisfied" with their current finances, up from 26 percent in 2009, according to a separate Towers Watson survey. Employees' confidence in their ability to retire also continued to climb: 23 percent were "very confident" of having enough income for the first 15 years of retirement.
1) Who exactly ran and funded the Watson study? Who runs a study and who funds a study gives you clues to your question. Interest groups are going to find what they want to find.
2) What exactly was the method of study "sampling" (in the American interviews, how were the interviewees found—"random" sampling on the street or white pages? sampling from certain zip codes or other sectors, etc)? How objectively the sampling was conducted gives you clues to your question.
Take all "research" with a grain of salt until you can answer these two questions.
1) Who exactly ran and funded the Watson study? Who runs a study and who funds a study gives you clues to your question. Interest groups are going to find what they want to find.
2) What exactly was the method of study "sampling" (in the American interviews, how were the interviewees found—"random" sampling on the street or white pages? sampling from certain zip codes or other sectors, etc)? How objectively the sampling was conducted gives you clues to your question.
Take all "research" with a grain of salt until you can answer these two questions.
Reading the article- and the links- certainly does not paint a uniformly rosy picture.
A good bit of the "improvement" is probably just a consequence of improvement in stock prices. If you had some investments, and you didn't panic and sell, you are probably feeling OK or better right now.
It IS true that there are many fewer big companies with pension plans. I think "were able to save and invest" and "was not able to save and invest" with be the key thing that determines if people stay comfortably middle class or whether they sink down upon retirement.
how dare you post positive information about retirement.
you should know better!
Well, it does save me the trouble of getting up, going out on the front deck, looking up and making a determination as to whether or not the sky has shifted position.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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I'm the second of 8, ranging from ages 62 to 43. Out of those myself and two others will have a decent pension plus social security. One other may get a small pension if he stays long enough and the union doesn't give it up in negotiations for a 401K. All the rest, including the oldest will have social security, if it still exists then, and that's it.
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