I have tried to respond to the most frequently asked questions on this page. Please email additional questions to firstname.lastname@example.org.
Q1. What is the Retirement Savings Shortfall?
- Using its unique Retirement Security Projection Model,® EBRI can estimate the total national aggregate and individual retirement deficits at age 65 for Early Boomers (born between 1948–1954, now ages 56–62), Late Boomers (born between 1955–1964, now ages 46–55), and Generation Xers (born between 1965–1974, now ages 36–45). ‘Retirement Savings Shortfalls for Today’s Workers’ reports these 2010 Retirement Savings Shortfalls (RSS).
- The estimates are present values (stated in 2010 dollars) at age 65, and represent the additional individual average amount needed at age 65 to eliminate expected deficits in retirement. The baseline number assumes that Americans will receive current-law Social Security benefits.
Q2. Why don’t you give actual dollar values for the salary quartiles?
- Unfortunately we need to use information during the worker’s entire career to determine pre-retirement income quartiles (similar to the AIME calculation for Social Security). This is explained in endnote 17 of The EBRI Retirement Readiness Rating:™ Retirement Income Preparation and Future Prospects
Q3. Why don’t you report the results separately for 401(k) participants?
- While we could perform a point in time classification of which households are currently participating in a 401(k) or currently have a 401(k) balance, it would not include any information on how many years they had participated (or been eligible to participate). Instead, we show in Retirement Income Adequacy for Today’s Workers: How Certain, How Much Will It Cost, and How Does Eligibility for Participation in a Defined Contribution Plan Help? that eligibility for a defined contribution (primarily 401(k)) retirement plan has a significant positive impact on reducing the additional compensation most families need to achieve the desired level of retirement income adequacy. This finding has major implications for any policies that would decrease the percentage of workers eligible to participate in defined contribution retirement plans.
Q4. I understand that the July 2010 Issue Brief shows the change in the Retirement Readiness Rating between 2003 and 2010 but I am interested in how the rating changed as a result of the crisis during the last two years in the financial markets as well as the housing market. Do you have any information on this?
- We recently completed a follow-up study with exactly this information as part of a project with another organization. It has been published as the February 2011 Issue Brief and can be found at: http://www.ebri.org/publications/ib/index.cfm?fa=ibDisp&content_id=4742.