Friday, May 27, 2016

Friday Feature Book Review: Falling Short (in retirement) by Charles D. Ellis チャールズD.エリスによる退職危機

More than 30 years ago, a major change to the US retirement system began. At that time, 401(k) programs began. This has changed how many US citizens view retirement, but the recent reasons for retirement are now impacting this change. How did this all begin, and how can we find our way out of this unclear future?

This book clearly explains how the future of US citizens will need to adjust to only "possible" future retirement plans. Many similar economies in Europe, Africa, Brazil, Japan, China and Asia are all looking at similar trends. 

Today, the average US citizen retires at age 64 for men and 62 for women. However, the average retired citizen will continue to live on for around 21 years for men, and 23 years for women. The average citizen will live for a much longer period than any planning is expecting. 

If the average US citizen has only US$111,000 in retirement savings, that is just $400 a month, and that number does not bode well for the future. The biggest change the author ties to suggest to raising the new retirement age from 65 to 70. A nice first step, but hardly a final guide for long term senior living prosperity.

How did pension go so wrong for so many? Almost 200+ years ago, the world's first pensions began in Europe, and were started by Napoleon. He started a military veteran's pension for his soldiers. At that time, the average French citizen lived until 55, so the starting pension age at 65, built 10 year cushion, and was very sustainable. Soon other parts of the government offered similar pensions to other citizens. 

Later, the private sector followed suit and the whole concept of a military or veteran connection was lost. The quality of life was able to rise in France and the rest of Europe, but the retirement age was never touched. This inability to adjust the retirement age has created a difficult to sustain system today. This is a focused book that really tries to bring ideas to a system in need of change. If thinking about bigger picture solutions turns you on, then this is a very inspiring starting point for a worldwide challenge for all citizens. Highly Recommended!

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