The Center for Retirement Research at Boston College, for example, estimates that in order to maintain their lifestyle in retirement, households need about 70% of pre-retirement income on average.
These numbers are the hand-waviest of guidelines. It all depends on what you plan to do in retirement. If you plan to travel the world, take the grandkids to Disney every week, and otherwise live like Santa on permanent vacation it’s going to go pretty quickly.
On the other hand, if your idea of a good time is to relax at home and hit the library for those books you always meant to read but never got around to reading, your money will last a whole lot longer.My idea of a good retirement is the latter, but I still max out my 403(b) and IRA contributions and plan to work until I’m at least 70 because I love my work. I’ll probably die with hundreds of thousands, maybe a million, untouched but that’s okay–it’s more money for Mrs Clam or my beneficiaries to have. In the meanwhile, knowing that I won’t have to eat dog food in a cardboard box lets me sleep better every night.
I think the economy is in for a huge reckoning when GenX starts to retire with no pensions and reduced Social Security. A whole segment of the population will no longer have any money to spend. This will implode our consumer driven economy.
Gen X got farked out of everything. We just missed out on being able to get drunk at work, being able to molest the secretaries, and being able to drive no matter how drunk we were, and now that we’re getting old, “dirty old man” has become a synonym for “creep”. It’s like everything is snatched away from us just before we get to enjoy it.
Millenials have it easy. They never got their hopes up.Thing is, the taxpayers’ elected officials have screwed the pooch when it comes to pension funds. Deferred payments, borrowing against the fund, and flat-out not contributing when growth is good, because the good times will last forever. There are many well managed and well funded pensions in this country and the one thing they have in common is that nobody ever farked with the contributions. The municipal pension that I will hopefully draw on one day is managed by the state, and the state does not allow the member cities to screw around with the money. It’s funded at 98%.
Particularly with police and fire, it should be noted that they are generally ineligible for Social Security. Cities all over the country have been exempted from paying that 6.5% employer contribution to Social Security because they supposedly had a secure pension in place. If a retired fire fighter or cop loses his pension, we’re not talking about subsidized elderly HUD housing and Chef Boyardee on Social Security checks, we’re talking no income.