The Retirement Crunch

For many Americans, the ability to live comfortably after they stop working is becoming increasingly difficult. While experts differ over whether this constitutes a crisis, they agree that a significant share of workers face a gap between what they have saved and what they will need in retirement. One estimate puts this gap at $3.83 trillion. The shortfall stems from several factors, including inadequate saving, lack of access to an employer-sponsored retirement plan, the spread of nontraditional work arrangements and a nationwide shift away from pensions with a set payout toward defined-contribution plans that place more responsibility for saving on the individual. The problem affects every age group to some degree. Private businesses and state governments have made efforts to better prepare people for retirement, but these programs often have limited reach. After failing to take meaningful action for more than two decades, Congress is showing renewed interest in the issue, and a handful of bills are making their way through the legislative process.