Does Social Security need to be expanded? Hell, yes. The latest evidence for that comes from a Government Accountability Office
study which has found that 52 percent of Americans nearing retirement age have no personal retirement savings. The study was requested by Sen. Bernie Sanders. Go Bernie!
Our savings aren't so paltry because we're a nation of irresponsible people, by the way.
"There hasn't been a significant increase in wages, people have student loans and other debt, and many are continuing to struggle financially," said Charles Jeszeck, the GAO's director of education, workforce and income security, which analyzed the Federal Reserve's 2013 Survey of Consumer Finances to come up with its estimates. "We aren't surprised that people have not saved a lot for retirement."
Even among those who do have retirement savings, their nest eggs are small. The agency found the median amount of those savings is about $104,000 for households with members between 55 and 64 years old and $148,000 for households with members 65 to 74 years old. That's equivalent to an inflation-protected annuity of $310 and $649 per month, respectively, according to the GAO.
"I don't care what anyone says. That's not enough income for retirement," said Anthony Webb, senior research economist at the Center for Retirement Research at Boston College, who reviewed the GAO report.
It's not enough. It's not enough to live on and it's not enough to help keep our economy strong when a huge babyboom cohort retires and can't afford to spend any money anymore. This report follows the
news that the Treasury collected $150 million in student loan debt from retirees this year. About 3 percent of people over 65 still have student loans—82 percent of them carrying loans for their own education, not children or grandchildren that they co-signed for. This group accounts for $18.2 billion in outstanding student loans.
On top of that, another new study from Voya Financial finds that 60 percent of retirees were forced to retire earlier than they had planned, because of a variety of factors, the most prevalent being health issues. But many were laid off and forced out of the job market, some had to quit to care for spouses or other family members. What this means is a lot of people having to live longer than they planned on not enough money.
So, yeah, Social Security needs to be expanded. And it needs to happen soon.