Retirement in the U.S
At some point in time, everyone is going to retire. Many worry if they will even have enough money saved up by that time to continue living on without a job. However, that is why many people begin working at a young age. The reason for this is so that they can contribute to social security taxes, as well as a 401(k).
These funds become available after retirement, and usually, they are a large amount of money depending on how long they have worked. Additionally, there is also a grading system that is used across the world, to calculate how retirement is in comparison to other countries.
The Retirement Grade Was a C+
With a score of 63 out of 100 points, the U.S. retirement grade just barely passed in comparison to other countries. “The U.S. system, which is funded mostly by individual retirement accounts (IRA), 401(k)s and Social Security, received an overall grade of C+, according to the report released Tuesday,” according to USA Today.
The average that was given by all countries was 62.9 points. It is clearly visible that the U.S. just barely was able to pass this average. In a way, this can be considered saddening, as there are many people who do not have the confidence to retire in this nation.
Confidence in Relation to Retirement
Confidence actually has a big role when it comes to retirement as a whole. People need to have the confidence to actually retire. However, as it is made clear by the rating, not many Americans have the confidence to retire. There are many companies in countries, such as Netherlands, where there are pension plans that are offered by the company.
These pension plans guarantee a lump sum after retirement. Therefore, in turn, more people are confident to retire, as they have these funds accessible to them.
The U.S can certainly learn from the actions of Netherlands and be able to incorporate a system of its own. “About 90% of employees in the Netherlands are covered by company-sponsored pension plans,” according to CBS News.
Can Inflation Impact Retirement?
Inflation actually has a lot of importance when it comes to retirement. Since everything is becoming more and more costly, certain retirees have to cut certain things out in order to adjust to these rising costs.
Due to this, many retirees may have to cut very important things from their lives, in order to meet the needs of rising costs.
This can certainly be addressed when it comes to government action. It is becoming increasingly difficult to retire in the U.S. Something needs to be done within the near future in order to restore confidence to retire for the American people. However, it is much easier said than done. Resources are needed in order to complete something this drastic, and without them, it may never happen.
The Future of Retirement in the U.S.
There is a hope that within the future, the grade significantly improves for the U.S. Otherwise, there may be a lot more people that continue to suffer. The last thing retirees need is to wonder if they are going to have enough money after they retire.
Companies can also offer more pension plans, that way after retiring, there are still funds available. There are many things that can be done, it is whether or not they will be done. Many hope that the future will have a more positive outcome for retirees.
Written by David Loran Jr
Sources:
USA Today: How does the U.S. retirement system stack up against other countries? Just above average.
CBS News: U.S. gets a C+ in retirement, on par with Kazakhstan and lagging other wealthy nations
Yahoo! News: Retirement Security: How the US Stacks Up Against Other Countries
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