Urban InstituteRetirement Policy Center

Briefs: Older Americans' Economic Security

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Is Household Debt Growing for Older Americans? (Series/Older Americans' Economic Security)
Nadia Karamcheva

An increasing number of Americans are entering old age with outstanding debt, forcing many retirees to devote some income to servicing their debt and leaving them with less to cover daily living expenses. Using Health and Retirement Study (HRS) data, this brief reports that the share of adults ages 65 and older with outstanding debt increased from 30 to 46 percent between 1998 and 2010. The inflation-adjusted median value of debt grew 56 percent over the period and the average ratio of total household debt over total household assets more than doubled.

Posted: January 31, 2013Availability: HTML | PDF

How Pension Reforms Neglect States' Recruitment and Retention Goals (Policy Briefs)
Richard W. Johnson, C. Eugene Steuerle, Caleb Quakenbush

To control rising pension costs, many states are reducing the generosity of the retirement plans they offer their employees, partly by increasing required employee contributions. These reforms, however, ignore the employee recruitment and retention problems created by traditional pension plans. Using New Jersey as a case study, this brief shows how state retirement plans discourage younger workers from joining the state's workforce, lock in middle-aged workers even if a job is not a good fit, and push older workers into retirement. Recent reforms make these plans even less appealing to a modern, mobile workforce.

Posted: July 16, 2012Availability: HTML | PDF

State Pension Reforms: Are New Workers Paying for Past Mistakes? (Policy Briefs)
Richard W. Johnson, C. Eugene Steuerle, Caleb Quakenbush

When state pension plans are underfunded, someone eventually has to pay for the shortfall. Many recent reforms designed to improve plan finances shift burdens to the young, particularly by making many new employees net contributors to—rather than beneficiaries of—these plans. Using New Jersey as a case study, this brief shows how states require higher levels of employee contributions, invest them in somewhat risky assets, and then, like a bank or financial intermediary, pay back many employees less in benefits than what they contributed and expected to earn on those contributions.

Posted: July 16, 2012Availability: HTML | PDF

How Will the Great Recession Affect Future Retirement Incomes? (Series/Older Americans' Economic Security)
Barbara Butrica, Richard W. Johnson, Karen E. Smith

The financial impact of the 2007–2009 recession will reverberate into retirement for many working families, even those who did not lose their jobs. Average wages grew very slowly during the downturn, reducing lifetime earnings. Lower earnings leave less income to set aside for retirement and depress future Social Security and pension incomes. Although unusually strong wage growth in coming years could bail out younger workers, there is little recourse for workers now approaching traditional retirement ages. For those age 55 to 59 in 2008, the Great Recession will reduce average age-70 incomes by 5 percent.

Posted: May 26, 2011Availability: HTML | PDF

Who Purchases Long-Term Care Insurance? (Series/Older Americans' Economic Security)
Richard W. Johnson, Janice Park

Most Americans will eventually need long-term care, which is often expensive and not usually covered by public programs until recipients have nearly exhausted their savings. In 2009, 5.2 million Americans age 65 and older not living in institutions had long-term care needs. Yet, only about 1 in 10 Americans age 55 and older had private long-term care insurance in 2008. Coverage rates were nearly twice as high among those with annual incomes in excess of $100,000. Private insurance covered only 7 percent of the $240 billion in U.S. long-term care costs in 2009. Nearly a fifth were paid out of pocket.

Posted: April 06, 2011Availability: HTML | PDF

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