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Opportunity and Ownership: Retirement Savings

 
 
 
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Understanding Early Withdrawals from Retirement Accounts (Discussion Papers)
Barbara Butrica, Sheila R. Zedlewski, Philip Issa

Less-advantaged individuals are less likely to have IRAs and 401(k)s, and those who do are more likely to withdraw savings before retirement. About 40 percent of withdrawals can be linked to adverse or investment events, including the onset of poor health, job loss, home purchases, and college expenses. Another 10 percent occur at job change for what may be reasonable expenses. Half of withdrawals can not be attributed to the events we could observe and may represent unnecessary loss of retirement savings. The results show the importance of policies that preserve retirement savings and increase savings for non-retirement events.

Posted: June 09, 2010Availability: HTML | PDF

Asset Building for Today's Stability and Tomorrow's Security (Article)
Signe-Mary McKernan, Caroline Ratcliffe

Today's weak economy, highlighted by job layoffs, high unemployment, and limited lines of credit, underscores the need for families to have savings to draw on during an emergency. Yet, the majority of low-income families have too few assets to weather emergencies. Even prior to the current recession, 57 percent of low-income families were liquid asset poor. This article discusses low-income families' asset holdings and promising policies aimed at addressing their short- and long-term needs. The package of proposals addresses the needs of families over the life course and considers the tension inherent in meeting families' short- and long-term asset-building goals.

Posted: May 03, 2010Availability: HTML | PDF

How Will the Stock Market Collapse Affect Retirement Incomes? (Series/Older Americans' Economic Security)
Barbara Butrica, Karen E. Smith, Eric Toder

Urban Institute projections suggest the stock market collapse will have small effects on most Americans' retirement incomes. It's estimated that 37 percent of Americans born between 1941 and 1965 owned no stocks when the market crashed in 2008 and that income from assets will account for a small share of retirement income, even for those with stocks. For most retirees, Social Security provides the majority of income. Had Social Security been invested in private accounts with equities, the impact of the crash would have been much larger—positive or negative, depending on one's birth cohort and on future market performance.

Posted: June 24, 2009Availability: HTML | PDF

What the 2008 Stock Market Crash Means for Retirement Security (Research Report)
Barbara Butrica, Karen E. Smith, Eric Toder

The one-third drop in the S&P 500 index between year-end 2007 and 2008 raises concerns about retirement security since Americans now hold more equities through their retirement plans. Those near retirement will fare the worst because they have no time to recoup their losses. Midcareer workers will fare better because they have more time to rebuild their wealth. They may even gain income if they buy stocks at low prices and get above-average rates of return. High-income groups will be the most affected because they are most likely to have financial assets and to be invested in the stock market.

Posted: May 13, 2009Availability: HTML | PDF

The Impact of Changing Earnings Volatility on Retirement Wealth (Research Report)
Austin Nichols, Melissa M. Favreault

Over the past several decades, the volatility of family income has increased markedly, and own earnings volatility has remained relatively flat. Volatility may affect retirement wealth, depending on whether volatility affects accrued pension contributions or withdrawals or earnings credited toward future Social Security benefits. This project assesses the effect of the volatility of individual and family earnings on asset accumulation and projected retirement wealth using survey data matched to administrative earnings records.

Posted: April 16, 2009Availability: HTML | PDF

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