Rebounds in the equity and housing markets have not had a significant impact on the retirement prospects of many Americans, according to new research sponsored by Prudential Financial, Inc.
In a paper published today, the Center for Retirement Research (CRR) at Boston College found that despite a 45 percent real increase in equity prices since 2010, and a six percent real increase in home prices over the same period, the impact on retirement security was only modest.
The research was conducted to determine the overall impact of the rebound in the equity and housing markets on the The National Retirement Risk Index (NRRI), which measures the share of working-age American households at risk of being unable to maintain their standard of living in retirement. The last update to the NRRI, published in October 2012, and based on 2010 data, found that 53 percent of households were at risk. The NRRI is sponsored exclusively by Prudential.
A new Prudential paper, “Planning for Retirement: The Impact of Market Recoveries on Retirement Preparedness,” summarizes the latest NRRI research and also highlights three critical ways to improve Americans’ retirement security:
- Savings: making sure individuals save enough for retirement
- Coverage: making sure individuals have access to a workplace retirement plan
- Retirement Income: making sure individuals can efficiently and prudently convert their retirement savings to retirement income
Exhibit 1. Percent of Households ‘At Risk’ at Age 65 by Income Group
Source: Center for Retirement Research
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