Retirement Benefits or Pipe Dream?
I dusted off something I’ve been meaning to post for a while. According to the September 3, 2006 edition of Parade (an insert in many Sunday papers), an organization called the Employee Benefit Research Institute found that 61% of Americans currently in the workforce expected employer-paid benefits when they retire.

Only one problem. Currently only 33% of medium to large sized employers currently provide benefits for retirees and this percentage is declining (it was 84% in 1980). Even generous companies are moving away from future benefits, preferring instead to help employees fund 401k programs or other similar programs that the employee controls. I applaud this trend for many reasons (for example, if your company goes bankrupt, it will not impact your 401k unless you only invested in your own company).

However, I am concerned about the number of people who are expecting retirement benefits from their firm when their firm does NOT provide these benefits. Unless the EBRI did a poor job in their research and surveyed a very unrepresentative group, there are going to be many surprised people as they near retirement.

I took a few minutes to look around the EBRI site. Some very interesting trivia there, useful for people like me who love reading statistics about people.


...combine these facts with the average savings rate, which was -2% last I heard, and the alleged Social Security crisis, and you really have to wonder... who is going to pay for all these old people?

Posted by: Roger Norris | 10/28/2006 - 12:56 PM
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