Fiscal troubles ahead for most future retirees

For the first time since the New Deal, a majority of Americans are headed toward a retirement in which they will be financially worse off than their parents, suggesting the end of an era of improved living standards for the nation’s elderly, according to a growing consensus of new research. As The New York Times reports, the Great Recession and the weak recovery darkened the retirement picture for significant numbers of Americans. And the full extent of the damage is only now being grasped by experts and policy-makers. There was already mounting concern for the long-term security of the country’s rapidly graying population. Then the downturn destroyed 40% of Americans’ personal wealth while creating a long period of high unemployment and an environment in which savings accounts pay almost no interest. Although the surging stock market is approaching record highs, most of these gains are flowing to well-off Americans who already are in relatively good shape for retirement. Liberal and conservative economists worry that the decline in retirement prospects marks a historic shift in a country that previously has fostered generations of improvement in the lives of the elderly. It is likely to have far-reaching implications, as an increasing number of retirees may be forced to double up with younger relatives or turn to social-service programs for support. The consequence is that the nation is facing a huge retirement savings deficit—as much as $6.6 trillion, or about $57,000 per household, according to a U.S. Senate report. Read the full story here.