Retirement Preparedness Research Yields “Alarming” Results Across Older Age Groups

Optimism is running high among those approaching retirement, some surveys say, but a new research brief from the Center for Retirement Research at Boston College finds that retirees may be even worse off today than previously thought, in terms of retirement preparedness.

While many older adults have a positive outlook on aging and their future quality of life, according to one survey, that optimism may be displaced, as the Center for Retirement Research found that wealth-to-income ratios for current workers dropped substantially in 2010 at the same time many costs were rising. 

Wealth-to-income ratios remained “remarkably” stable from 1983 to 2007, the research finds based on the Federal Reserve’s Survey of Consumer Finances (SCF), but this should never have been a source of comfort. This is because the need for wealth increased over the same time period, due to rising life expectancy, a shift to 401(k) plans, increasing health care costs and lower real interest rates. 



When the average wealth-to-income ratio dropped in 2010, this led to an even greater cause for concern over serious problems ahead for future retirees, BC finds. 

“In this context, the significant decline in the ratios of wealth to income for each age group reported in the 2010 SCF is truly alarming,” the report states.


View the study brief

Written by Elizabeth Ecker

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