This is one of the
of the week:
We are on the precipice of the greatest retirement crisis in the history of the world. In the decades to come, we will witness millions of elderly Americans, the Baby Boomers and others, slipping into poverty. Too frail to work, too poor to retire will become the “new normal” for many elderly Americans.
That dire prediction, which I wrote two years ago, is already coming true. Our national demographics, coupled with indisputable glaringly insufficient retirement savings and human physiology, suggest that a catastrophic outcome for at least a significant percentage of our elderly population is inevitable. With the average 401(k) balance for 65 year olds estimated at $25,000 by independent experts—$100,000 if you believe the retirement planning industry—the decades many elders will spend in forced or elected “retirement” will be grim.
For context, the author is Edward "Ted" Siedle, a former mutual fund legal counsel and adviser on pensions, investment management and securities. Hardly a hippie. He explains that corporate pensions are a thing of the past, and public pensions are seriously endangered. Decades of stagnant wages and rising cost of living have made saving for anything—college, a car, a down payment for a house, much less retirement—impossible for many families. The retirement savings vehicle most available to workers now, the 401(K), is failing, massively.
Siedle thinks it's only going to get worse, coming in waves, and that "with each successive wave, more elderly will be drowned." First it's the younger retirees who have to return to work full-time to cover expenses. The second wave are the now near-retirees, who are going to have to stick with their jobs as long as their employers will keep them, even if that means "demotions, pay cuts or part-time status to stay on." Then there's wave three, when "current workers and retirees at some point realize that they can never fully retire, i.e., stop working altogether, and commit to working part-time for as many of their golden years as possible." Which for many will not be physically possible, leading to wave four:
At some point, lack of savings, lack of employment possibilities and failing health will catch up with the overwhelming majority of the nation’s elders. Let me emphasize that we’re talking about the overwhelming majority, not a small percentage who arguably made bad decisions throughout their working lives. [...]
Eventually the pain will be so widespread that the crisis will be impossible to ignore. For many, the challenge is to hang in there until help arrives.
At this rate, help isn't going to arrive any time soon. While this crisis is unfolding, Washington is still irrationally obsessed with the deficit and insisting the "balanced" solution for that manufactured crisis is "shared sacrifice" in which the old people have to give up at least a pound of flesh.
Social Security doesn't need to be cut, not through a chained CPI or raising the retirement age or anything else. It needs to be expanded and increased. Sending that message is one of the goals of Social Security Defenders at Daily Kos. We'll be writing on it all week, and below the fold, you can see the schedule for posts throughout the week.
Send an email to President Obama and congressional leadership telling them to strengthen Social Security instead of cutting it.
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