Report: Americans unprepared for retirement

Americans today are less prepared for retirement than previous generations, with half of all U.S. households at risk of a lower standard of living after they leave the workforce, according to a report by the Joint Economic Committee Democrats.

“Americans find it increasingly hard to save for retirement amid stagnant wages and the rising cost of housing, health care and college,” said Rep. Carolyn Maloney (D-N.Y.), the committee’s vice chair.

{mosads}The report found that even people working past the average retirement age, annuitizing their financial assets or reverse mortgaging their homes were in danger of lowering their standard of living in retirement.

“Worse, forty percent of workers ages 50-60 who are not currently poor would be poor if were they retire at age 62. Women, Blacks and Hispanics are at substantially greater risk of being poor in retirement,” the report said.

While Social Security has helped prevent older Americans from falling into poverty, the report noted that there have been sharp declines in the other two main sources that fund retirement, personal savings and pensions.

Among wage-earners, fewer than half have retirement contribution accounts such as 401(k)s or individual retirement accounts, and those who do tend to be higher earners. The median worker has no retirement savings at all. The 37 percent of workers who had pensions in 1989 has fallen to just 19 percent.

“As a result, it is particularly important to protect and strengthen Social Security, while recognizing that the rest of our retirement system is in crisis,” Maloney said.

The report’s release coincides with the 84th anniversary of the Social Security program.