Five Tips to Transition into The New Normal with Your Retirement Intact

Five Tips to Transition into The New Normal with Your Retirement Intact

Why Do Late Boomers Have So Little Retirement Wealth?

Retirement-focused research of interest.
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The Center for Retirement Research at Boston College recently published Why Do Late Boomers Have So Little Retirement Wealth? The brief’s key findings are:

  • With the gradual shift from defined benefit plans to 401(k)s, younger age cohorts would be expected to have more retirement wealth in 401(k)s.
  • However, data for the Late Boomers at ages 51-56 show a surprising drop in 401(k)/IRA assets compared to earlier cohorts at the same ages.
  • Late Boomers were particularly hard hit by the Great Recession, with a significant share remaining out of the labor force even as the economy recovered.
  • But even those who were working had lower earnings, less 401(k) participation, and flat 401(k) balances.
  • Why Late Boomers were hit so hard, why they have struggled since, and the fate of future cohorts remain open questions.

The Mid-Life Dip in Well-Being: Economists (Who Find It) Versus Psychologists (Who Don’t)! 

The National Bureau of Economic Research recently published The Mid-Life Dip in Well-Being: Economists (Who Find It) Versus Psychologists (Who Don’t)! 

Here's the abstract: A number of studies – including our own – find a mid-life dip in well-being. We review a psychology literature that claims that the evidence of a U-shape is "overblown" and if there is such a decline it is "trivial". We find remarkably strong and consistent evidence across countries and US states that statistically significant U-shapes exist with and without socio-economic controls. The US is somewhat of an outlier with evidence of an early uptick in the raw data with some variables – but not in others – that disappears when controls are included. We show that two of the studies cited by psychologists suggesting there are no U-shapes are in error; we use their data and find the opposite. The effects of the mid-life dip are comparable to major life events like losing a spouse, losing a job or getting cancer. They are clearly not inconsequential.

One-Quarter of Older Americans Live in California, Florida, and Texas 

The Population Reference Bureau recently published One Quarter of Older Americans Live in California, Florida, and Texas www.prb.org/which-us-states-are-the-oldest

Key findings

About 52 million Americans are age 65 or older, according to the Census Bureau’s 2018 population estimates. One-quarter of these older Americans live in one of three states: California, Florida, and Texas. Seven other states—Georgia, Illinois, Michigan, New York, North Carolina, Ohio, and Pennsylvania—account for another one-quarter of Americans age 65 or older. These 10 states are also the most populous and include over half of the total U.S. population. Sparsely populated states such as Alaska, North Dakota, South Dakota, Wyoming, and Vermont have very small older populations—less than 150,000 each in 2018.

Excerpted from PRB’s Population Bulletin, “Elderly Americans,” by Christine L. Himes, and updated in 2019.

Other research of interest

· Proceedings of the National Academy of Sciences: US life expectancy stalls due to cardiovascular disease, not drug deaths www.pnas.org/content/117/13/6998

· Center for Retirement Research at Boston College: Are Older Nontraditional Workers Able to Find Health and Retirement Coverage? http://crr.bc.edu/working-papers/are-older-nontraditional-workers-able-to-find-health-and-retirement-coverage/; Employer Perceptions of Older Workers – Surveys from 2019 and 2006 http://crr.bc.edu/working-papers/employer-perceptions-of-older-workers-surveys-from-2019-and-2006/; Are Homeownership Patterns Stable Enough to Tap Home Equity? http://crr.bc.edu/working-papers/are-homeownership-patterns-stable-enough-to-tap-home-equity/

· Public Library of Science: Impact of food insecurity with hunger on mental distress among community-dwelling older adults http://journals.plos.org/plosone/article?id=10.1371/journal.pone.0229840

· National Academy of Social Insurance: Examining Approaches to Expand Medicare Eligibility: Key Design Options and Implications www.nasi.org/research/2020/examining-approaches-expand-medicare-eligibility-key-design

· Employee Benefits Research Institute: Withdrawal Activity of Individuals Owning Both Traditional and Roth Individual Retirement Accounts www.ebri.org/content/withdrawal-activity-of-individuals-owning-both-traditional-and-roth-individual-retirement-accounts

· AARP Public Policy Institute: Characteristics of Americans Ages 50 to 64 in the Nongroup Health Insurance Market and Enrollment and Coverage Trends for Americans Ages 50 to 64 in the Nongroup Health Insurance Market www.aarp.org/ppi/info-2020/the-affordable-care-act-and-older-adults.html

· US Social Security Administration: Social Security Programs Throughout the World: The Americas, 2019, www.ssa.gov/policy/docs/progdesc/ssptw/2018-2019/americas/index.html and DI & SSI Program Participants: Characteristics & Employment, 2015 www.ssa.gov/policy/docs/chartbooks/di-ssi-employment/2015/index.html

· The Irish Longitudinal Study on Ageing: TILDA Report to Inform the Demographics for the Over-50 in Ireland for the COVID-19 Crisis www.tilda.tcd.ie/publications/research-briefs/pdf/Report_DemographicsOver50s.pdf

· Center for Retirement Research at Boston College: Auto-IRA Rollout Gradually Speeding Up http://crr.bc.edu/briefs/auto-ira-rollout-gradually-speeding-up/

· Kaiser Family Foundation: Examining Current Medicare Part D Policies for Extended Supplies of Medication www.kff.org/medicare/issue-brief/examining-current-medicare-part-d-policies-for-extended-supplies-of-medication/

· UK Office for National Statistics: Living longer: implications of housing tenure in later life www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/ageing/articles/livinglonger/implicationsofhousingtenureinlaterlife

· Population Reference Bureau: One Quarter of Older Americans Live in California, Florida, and Texas www.prb.org/which-us-states-are-the-oldest

· US Government Accountability Office: Medicare and Medicaid: Alignment of Managed Care Plans for Dual-Eligible Beneficiaries www.gao.gov/products/GAO-20-319

· Employee Benefits Research Institute: The Impact of Rising Household Debt Among Older Americans www.ebri.org/content/the-impact-of-rising-household-debt-among-older-americans

· Australian Institute for Health and Welfare: Coordination of health care: experiences of barriers to accessing health services among patients aged 45 and over www.aihw.gov.au/reports/primary-health-care/coordination-of-health-care-experiences-barriers/contents/table-of-contents

· US Department of Health and Human Service: Key Medicare Tools To Safeguard Against Pharmacy Fraud and Inappropriate Billing Do Not Apply to Part D http://oig.hhs.gov/oei/reports/oei-02-15-00440.asp

· UK Office for National Statistics: Changing trends in mortality by leading causes of death, England and Wales: 2001 to 2018 ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/deaths/articles/changingtrendsinmortalitybyleadingcausesofdeathenglandandwales/2001to2018 

· International Longevity Centre: Safeguarding healthy ageing – Potential solutions to improve immunisation coverage rates among older adults in the UK www.ilcuk.org.uk/safeguarding-healthy-ageing-potential-solutions-to-improve-immunisation-coverage-rates-among-older-adults-in-the-uk/  

· US National Center for Health Statistics: Trends in Electronic Health Record Use Among Residential Care Communities: United States, 2012, 2014, and 2016 www.cdc.gov/nchs/data/nhsr/nhsr140-508.pdf

· National Bureau of Economic Research: The Long-lasting Effects of Living under Communism on Attitudes towards Financial Markets www.nber.org/papers/w26818 and Education and Health Over the Life Cycle www.nber.org/papers/w26836

· US Bureau of Justice Statistics: Mortality in State and Federal Prisons, 2001-2016 – Statistical Tables www.bjs.gov/index.cfm?ty=pbdetail&iid=6766

· US Social Security Administration: International Update, February 2020 www.ssa.gov/policy/docs/progdesc/intl_update/2020-02/index.html

· UK Office for National Statistics: Employee workplace pensions in the UK: 2019 provisional and 2018 final results www.ons.gov.uk/employmentandlabourmarket/peopleinwork/workplacepensions/bulletins/annualsurveyofhoursandearningspensiontables/2019provisionaland2018finalresults

· Care Quality Commission: Promoting sexual safety through empowerment: A review of sexual safety and the support of people’s sexuality in adult social care www.cqc.org.uk/publications/major-report/promoting-sexual-safety-through-empowerment

· International Longevity Centre: Never too late: Prevention in an ageing world http://ilcuk.org.uk/never-too-late-prevention-in-an-ageing-world/

· US Government Accountability Office: Medicare: Information on Medicare-Dependent Hospitals www.gao.gov/products/GAO-20-300 

· National Bureau of Economic Research: Can Low Retirement Savings Be Rationalized? www.nber.org/papers/w26784

The Center for Retirement Research at Boston College recently published Why Do Late Boomers Have So Little Retirement Wealth? The brief’s key findings are:

  • With the gradual shift from defined benefit plans to 401(k)s, younger age cohorts would be expected to have more retirement wealth in 401(k)s.
  • However, data for the Late Boomers at ages 51-56 show a surprising drop in 401(k)/IRA assets compared to earlier cohorts at the same ages.
  • Late Boomers were particularly hard hit by the Great Recession, with a significant share remaining out of the labor force even as the economy recovered.
  • But even those who were working had lower earnings, less 401(k) participation, and flat 401(k) balances.
  • Why Late Boomers were hit so hard, why they have struggled since, and the fate of future cohorts remain open questions.
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