"Life expectancy is high; if you retire at 65, you're going to need to fund potentially decades of living expenses. A great many people underestimate how much they need to accumulate in a 401(k) or an IRA to fund a retirement of that length. People also tend to have smaller families and fewer people to rely on. But there's also a challenge that comes from the complexity of the financial system itself."
"More than half of middle-income older adults in the U.S. believe that their savings won't last them through retirement, according to findings published in November by the Pew Research Center. John Y. Campbell, the Morton L. and Carole S. Olshan Professor of Economics, isn't surprised that people are worried. "What does concern me is that it's not always the right people who are worried," said Campbell, co-author of the new book "Fixed: Why Personal Finance is Broken and How to Make it Work for Everyone.""
More than half of middle-income older adults in the U.S. believe their savings will not last through retirement. High life expectancy and long retirement horizons raise required savings. Many people underestimate how much to accumulate in 401(k)s or IRAs. Smaller families and fewer informal supports increase reliance on personal savings. High housing costs and student debt make retirement saving more difficult. Complexity of the financial system creates confusion, anxiety and avoidance, leading individuals to postpone action. The financial system operates in ways that channel resources away from the vulnerable, increasing inequality and setting many up for retirement failure.
Read at Harvard Gazette
Unable to calculate read time
Collection
[
|
...
]