Baby Ka-Boomers:Their Three-Legged Stool for Retirement Income Is Crumbling

The Three Legged Stool Is  Crumbling Under the Weight of the Baby Ka-Boomers

The three-legged stool is the picture that has been used to illustrate the three potential streams of  income that Americans will have when we retire. These three traditional income streams are:

  1. Social Security
  2. Pension 
  3. Personal Savings


Guess which one is disappearing? (Hint: Pension)  80% of Americans do not have a pension. And, large corporations are not offering pensions to new employees and are freezing the pensions that they do have for currently enrolled workers.

Personal Savings

Now, guess which leg of the stool has been an illusion for many of us? (Hint: Personal Savings) Many Americans can’t or won’t save to set up an emergency fund, let alone save for retirement. That’s why the Federal government recently mandated that company workers be ‘automatically’ enrolled into their company 401(k) unless the employee specifically ‘opts out.’

Social Security

So, with one broken leg and one leg that is an illusion for many, I think it’s safe to say that many of us are thinking that Social Security will be enough to live on while in retirement, right?  If you are thinking that, you are wrong. At best, you should expect Social Security to provide for about 25% – 30% of your retirement income. Depending on you point of view, if you are pessimistic about the future of Social Security, all you’ll have is your own savings -not a pretty picture.

Current Facts About Ka-Boomer Retirement

Remember those pictures about an older, grey- haired couple walking hand in hand down the beach? Those pictures were used to signify our ‘happy’ retirements. For many of us, we’ll need to erase those images completely from our minds. Our ‘retirements’ will include at least some part-time paid work.


  • Americans are saving a meager 3.5% of every dollar 
  • We are living longer and have not factored that into our retirement planning
  • Medical costs continue to rise
  • Low interest rate environment
  • We are expecting the stock market to bail us out

So, the bad news is that many “Baby Ka-Boomers” are ill-prepared to fulfill their visions of ‘happy’ financial retirements. And, some of the critical portions of sustaining the ‘older’ Ka-Boomer generation during retirement will fall to our younger workers.

Jane Nowak is a Financial Planner with Kring Financial Management located in Atlanta, Ga. Jane’s practice focuses on Women’s Retirement Planning and Financial Planning for Women. Her articles have been published on line at NASDAQ, Financial Planning Association and Follow Jane on Twitter at:


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