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View Diary: My view of chained CPI at age 67 (48 comments)

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  •  Those "Defined Benefit Plans" Boomers... (1+ / 0-)
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    musiccitymollie

    ...supposedly "have."

    The Boomers that entered the workforce between 1962 and 1978 got hired by companies that offered pensions. If they were lucky the company they worked for didn't go bankrupt by the time they started retiring.

    In 1978 the 401(k) was born. At first it was considered a luscious perk that people were willing to change jobs for -- because it was an additional form of retirement income. This is when the "three-leg stool" theory of retirement income became the gospel of industry, the stool being your pension, income from your 401(k) and Social Security.

    Which was well and good, but about the time the Federal Government started moving its' employees into this sort of plan (1986-87), private industry began phasing out pensions in favor of 401(k)s. So the Boomers who entered the workforce after 1980, were rarely offered a pension, and were much more likely to be trying to build a retirement nest egg based on a stool with only two legs...

    We've had two recessions while the Boomers were trying to save for retirement -- and there are many late wave Boomers who have been losing their jobs because they're over 50, while the houses they bought haven't held their value, and it will be 12 years before they can apply for Social Security benefits. If they have managed to save any money, I'm willing to bet it will be gone long before then.

    Before you assume that most of the Boomer contingent is experiencing a cushy retirement (or even expects to) -- why don't you ask them? I think the answers you'd get would surprise you.

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