Authorpreneur Dashboard – Richard L DeProspo
Up in Smoke
Business & Investing
With the first of the Baby Boom generation having reached the traditional retirement age of sixty-five in 2011, the number of retirement age individuals is expected to grow by 10,000 each day for the next fifteen years.
By 2030, when the last of the Baby Boomers will have turned sixty-five, an estimated 18% of the US population, or sixty-five million Americans, will have reached retirement age.
Up In Smoke provides a startling examination of the status of each of our nation’s retirement systems and explores how a pending retirement crisis could threaten the US economy. Those nearing retirement, as well as generations to follow will increasingly be seeking an understanding of how we arrived at this difficult place and what hope lies ahead. Up In Smoke provides those insights.
Book Bubbles from Up in Smoke
Corporate America's Hasty Exit from Retirement Pla
The rapid adoption of 401(k) plans by US companies in the early 1980s has left a generation of private sector workers unprepared for the expenses of retirement. The Baby Boomers are the first generation in 100 years to fund retirement solely through personal savings and Social Security. But what happened to corporate pension plans that had served previous generations so well in their retirement years?
Will Chicago Become the Next Detroit?
The Chicago Public School System made the headlines again last week, this time the subject of a downgrade by Standard
Could the 401(k) Ever Have Worked?
With the leading edge of the baby boom generation reaching 65, we are just now beginning to see the effect of America's transition from traditional corporate sponsored retirement plans, to defined contribution savings accounts. Today, of those eligible for 401(k) and IRA savings accounts, only 50% have actually funded them. Of those that have and are now approaching retirement (age 55-64) the median balance is just $111,000. But the question that now arises is could the 401(k), even under the best of circumstances, produce the savings necessary to fund a comfortable retirement? The answer might surprise you.
Illinois' Underfunded Pensions Imply Further Tax I
Many cities and states in the US now face staggering levels of unfunded public employee retirement liabilities. Some may be inclined to dismiss the news, thinking it's simply not their problem. But for residents in these communities, it very much is. Whether taxes on personal income, property or retail sales, nationally, 91% of state and local government revenues come from taxes on individuals. Here's what it means to the State of Illinois.
Local government's massive pension challen
Beneath the headlines of growing economic crises in Greece and Puerto Rico, the finances of many US cities and states are increasing showing signs of distress. Quietly, below the radar and at a surprisingly swift pace, unfunded public employee pension liabilities have grown to unsustainable levels for many US local governments. The recent bankruptcies of Detroit, Stockton and San Bernardino may soon be followed by those of even larger cities and states, producing troubling outcomes for residents and taxpayers.
Just How Prepared are Americans for Retirement?
The GAO just released a new report on retirement security. Their conclusion: most households approaching retirement have very low savings. Just how low, though, is startling. Among households aged 55 and older, one-half have no retirement savings at all in 401(K), IRA or similar defined contribution accounts. Similar findings were reported in a 2013 study of the Federal Reserve Bank, along with the fact that for those age 55 and older that do have retirement accounts, the median balance was just $111,000.
Understanding the Social Security Trust Fund
The Presidential campaign of Bernie Sanders has generated a heightened interest in Social Security and what should be done to preserve the program for future generations. By the Social Security Administration's own projections, the Trust Fund supporting Social Security will become insolvent by 2033. But even this estimate doesn't reveal the true nature of the Fund's underlying assets and liabilities and the factors that undermine its future.
The Retirement Crisis
The underpinnings of the US retirement crisis can be traced to the Revenue Act of 1978, the legislation that created the 401(k) and IRA account. Intended by Congress as a quick fix to US tax law, and not as broad retirement policy, the new plans nonetheless grew quickly in popularity. Corporate America seized the opportunity to offer the new defined contribution plans to employees. Equipped with a new retirement option, these same companies quietly exited the defined benefit plans that had both dominated US retirement funding for fifty years, and created enormous liabilities for corporate balance sheets. But the 401(k) and IRA suffered their own design flaws and limitations, a fact that America would not discover until some thirty years later.
