When it came to affording retirement, the old assumption could be imagined as three legs holding up a stool. The first leg was retirement savings, the second leg was social security and the third leg was monthly pension payments.
However, that stool is beginning to look pretty wobbly these days. That’s because today’s workers can no longer rely on a pension to provide needed monthly income in retirement. According to the U.S. Department of Labor, only 18% of private industry employees were covered by a defined benefits plan in 2011. This is a sharp decrease from the 35% rate of private industry coverage seen in the early 1990s.
While those working for the government still have hope of enjoying a pension in retirement, the rest of the population will need to focus even more on personal savings as a way to fund retirement and long term care needs. Social Security is another risky leg, especially for today’s younger workers. Experts tend to agree that social security will begin running out if drastic changes are not made to the qualification standards and the amount of benefits paid out in the next decade or two.
Many state pension plans are also struggling. It may not be too far of a stretch to imagine a future where pensions are completely non-existent. Planning is a good idea when it comes to paying for assisted living, Care Placement can find the right place for you for your budget.