Retirement for US workers just isn't what it used to be. Forget the gold watch and reliable pension check after 30 years of service. The impact of globalization and competition from low-wage companies that don't provide benefits has shifted the onus of retirement security from larger firms onto individuals.
Twenty years ago, 40 percent of American workers were covered by traditional pensions known as defined-benefit plans. Today that number's dropped to 20 percent. As the Bethlehem Steel and United Airlines examples show, even that 20 percent may not be able to count on what they've been promised. Currently, about 75 percent of those corporate plans are underfunded. "There are numerous threats to retirement in the future," says Brad Belt, executive director of the PBGC. "So it's incumbent on individuals to be well informed, prudent about their investments, and to save accordingly."
To get a sense of the impact of the pension crisis on individuals, Pilots, who by law must retire at 60, could see their retirement income cut by 75 percent.
- Alexandra Marks, The Christian Science Monitor
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