Flying in the face of many experts, the Investment Company Institute’s Peter Brady, a retirement and investment research economist, said Thursday there is no retirement crisis.
To suggest there is a widespread epidemic of Americans living inadequately when they’re no longer working is wrong, he contended.
“Two-thirds to five-sixths of people are prepared for retirement,” Brady told an Employee Benefit Research Institute forum in Washington, D.C. “Retirees who have Social Security, their homes paid off and no kids [at] home are going to be pretty close to where they need to be.”
Brady said over 70 percent of retirees (predominantly those with moderate incomes) tap into retirement savings such as pensions and annuities within three years after starting to receive Social Security payments.
Three-quarters of families headed by individuals age 55 to 64 have retirement savings from employer-based plans they can rely on as well as Social Security, the researcher noted.
“Many retirees can maintain their standard of living with relatively modest retirement savings,” Brady asserted.
A major reason, he said, is that in addition to Social Security, people have income from pensions, annuities and IRAs. This income is widespread, persistent and substantial, he said.
If U.S. workers had a structure that would guarantee adequate retirement resources, it would look a lot like the system does today, the economist claimed.