BERKELEY – As the first wave of America’s baby boomers begins to retire, the retirement system is revealing its flaws. More than half of all workers (and more than 60% of low-income workers) are at risk of lacking sufficient savings to maintain their living standards after they stop working. In a recent international comparison, America’s retirement system received a passing grade of C; but, for a large and growing number of Americans, the system is failing.
The slow recovery from the Great Recession has exacerbated the challenge. Homes are most Americans’ major retirement asset, and, despite a recent pickup, housing prices are still 28% below their 2006 peak, while 28% of all homeowners owe more on their mortgages than their property is worth.