The economic decline of the last 15 months, has resulted in a staggering $2 Trillion loss to American retirement accounts, according to the head of the Congressional Budget Office Peter Orszag Public and private pension funds, and retirement savings accounts such as 401(k)’s and IRA’s, have lost some 20 percent in value since mid-2007.
And the trend is for further declines in retirement accounts. An article by AP writer Julie Hirshfeld Davis, indicates that Americans have responded by delaying their retirements, and paradoxically reducing their retirement savings contributions. And, employees are working more hours, to try and make ends meet.
A year ago, right before the housing collapse, I estimated that 15 million Americans had a net worth, sufficient to allow them to retire. The next Census Bureau report on household net worth, does not come out until the year 2010, so it is impossible to accurately calculate how many less Americans are able to retire. However, using the 20% decline in the value of retirement accounts, would translate into 3 million less Americans are able to retire since a year ago.
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1 response so far ↓
1 Bob Richards // Oct 7, 2008 at 8:56 pm
Just as well. The country is headed for a terrible labor shortage anhaving baby boomers in the work force is good for all. Social Security does not have enough to support them anyway. Additionally, there is ample evidence that lack of activity leads to dimentia and early. So let us all work part time and contribute til we die and have sufficient retirement income.
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