Retirement Plans and Prospects for Retirement Income Adequacy

Will Americans have enough to live on in retirement? This paper attempts to address that question for the Baby Boomer and Gen Xer generations. While it is widely accepted that employment-based retirement plans have played a significant role in providing retirement income to American workers, this paper quantifies the impact that those programs have in the determination of retirement income adequacy. The analysis in this paper reveals that one of the most important factors in determining whether Gen Xers would have sufficient retirement resources is eligibility for participation in an employment-based defined contribution plan

The Declining Role of Private Defined Benefit Pension Plans: Who is Affected, and How

This chapter analyzes the impact of future freezes among corporate defined benefit (DB) pension plans. We simulate the impact on expected future pension wealth by assuming all existing private DB plans immediately freeze accruals for new employees. While this indicates the potential reduction in retirement wealth attributable to such plans, it does not recognize that sponsors freezing accruals may increase employer contributions to existing defined contribution (DC) plans or establish new DC plans. Using an empirical distribution of enhanced contributions to DC plans from sponsors freezing their DB plans, we simulate the nominal annuity that could be purchased at retirement age from these enhanced contributions. We then back out the net pension loss experienced by employees in the future

The Role of 401(k) Accumulations in Future Retirement Income

Defined contribution (DC) plans are increasingly being offered as the primary employer-sponsored pension, so it is of interest to ask whether DC accumulations are likely to yield sufficient income in retirement. This chapter uses the EBRI/ICI 401(k) Accumulation Projection Model to explore alternative future scenarios for retirees having had 401(k) plans available over a full working career. We assess the impact of catch-up contributions recently permitted by legislation; saving through individual retirement accounts if the employer does not offer a 401(k) plan; and changing the retirement age