With empathy, I read a recent letter written to the online financial zine MarketWatch. The query was on the topic of retirement written by a 50-year-old male — let’s call him Frank — who confesses to “losing a lot of sleep worrying about tomorrow.” He reveals more: “I obsess on retirement calculations.”
I too have obsessed on this topic. Let us first take a look at the larger retirement landscape.
Most American retirees rely upon the federal Social Security Retirement Trust Fund which now has $2.8 trillion dollars remaining in the till and is on track to run dry by 2031. Of course the federal government as a whole is insolvent, so why nit-pick on this program in particular?
Because I like the concept, the intention; the Social Security Act was created as a social safety net on the heels of the Great Depression in 1935 in the face of widespread financial devastation. Relying on the waves and whims of the “market” after having invested in a career that spans 40-plus years of employment was proven to be a risky proposition.
While the social security bucket is leaking, we find that 50 percent of employers have stopped contributing to 401(k) retirement plans. Couple all this with a trend by employers — inspired by the economic stresses of COVID, to shed their payrolls of the “Willy Loman’s” in favor of retaining key, mid-career employees, and we once again have the recipe for long soup lines — the very images that fed Social Security legislation.
Large swaths of older employees are being “incentivized” or outright forced into retirement. No wonder we find gray and white hair plentiful in our expanding urban tent cities.
A related piece of Depression-era legislation, the Wagner Act, which provides private sector employees the right to organize into trade unions and engage in collective bargaining, has been, for the most part, eviscerated. Note the recent failed attempt at an Amazon warehouse in Alabama to form a union. Retirement safety nets for expendable warehouse labor isn’t high on the corporate board’s agenda this week.
And by the way, Frank, who is “losing sleep,” has $1.7 million in an IRA and his 401(k), as an executive employee has annual income of close to $300,000, and nets $6,000 a month from his eight rental properties. Thought to mention that before you begin prepping your prayers for him and his family.
Frank’s perceived woes are important to note though, as they signify the futility in our attempts to prop-up the expectations of the fading American Dream. The immense energy-intensive inputs to achieve even a middle-class lifestyle are no longer sustainable — and we haven’t even begun to talk about Americans living longer, requiring feeding straws and round-the-clock dementia care. Seventy-nine percent of middle-income baby boomers have zero in savings put aside for long-term care, the kind not covered by Medicare.
We would be naïve to assume that those ubiquitous gray and white hairs peppering our urban debris fields are someone else’s problem. These “losers” happen to be embedded in our collective culture, a culture that establishes social expectations for success early on. Something had blocked their vision and they couldn’t follow the script.
Oddly enough, they share that perspective with our well-heeled friend Frank, anxiously peering over their shoulders at neighbors who have more, and the fear that at any moment it could all be taken away from them.
As for my own retirement, I’m an older Dad and am counting on my clever Gen-Z kids to make it big on YouTube or as an Amazon seller. In the meantime, I remain grateful for peanut butter and jelly and set my expectations accordingly.
After years of globetrotting, Broadman finds himself writing from his perch on the Palouse and loving the view. His policy briefs can be found at US Resist News: https://www.usresistnews.org/