Big or small, missteps with our money can harm our financial future. Here are some of the most common financial fails, and how to avoid them. 1. Failing to Save We used to think of retirement planning like a three-legged stool. Retirees could rely on a pension from their employer, Social Security from the government and their own retirement savings. Those three legs created a nice nest egg. Now, with pensions becoming a thing of the past and the...
The United States could learn quite a bit from other countries around the world when it comes to retirement security, according to a new report. The annual Global Retirement Index, started by Paris-based investment bank Natixis Investment Managers, analyzes four key indexes: finances in retirement, including taxes and the old-age dependency ratio; health, such as life expectancy and expenses; “material well being,” which is income equality and unemployment; and quality of life, including happiness and water quality. Iceland topped...
By Mariacristina De Nardi Giulio, Fella Marike Knoef, Gonzalo Paz-Pardo Raun Van Ooijen We document new facts on the distributions of male wages, male earnings, and household earnings and income (before and after taxes) in the Netherlands and the United States. We find that, in both countries, wages display rich dynamics, including substantial asymmetries and nonlinearities by age and previous earnings levels. Individual-level male wage and earnings risk is relatively high for younger and older people, and for...
By Sebastian Finkler Providing a decent living standard and preventing old-age poverty are the two major challenges of pension insurance schemes. Replacement rates below the poverty line despite many years of contribution represent a major challenge for public pension schemes with respect to the systems 'raison d’être'. The focus of the present paper turns away from individual perspective and considers household retirement incomes in the light of analysing old-age poverty and designing (minimum) pension policies. Using household survey and...
The Government’s plan to introduce mandatory private pensions for all workers above a certain income limit by 2022 is now in danger of being stalled, putting at risk the adequacy of worker’s future pension pots. With private pensions still inadequate – research from the Economic and Social Research Institute last week found that women are retiring with significantly smaller pension pots then men – Irish Life, in its pre-budget statement, says the introduction of auto-enrolment needs to be “expedited”....
Senior Fellow Joseph E Stiglitz America currently has the most inequality, and the least equality of opportunity, among the advanced countries. While market forces play a role in this stark picture, politics has shaped those market forces. In this best-selling book, Nobel Prize winning economist Joseph E. Stiglitz exposes the efforts of well-heeled interests to compound their wealth in ways that have stifled true, dynamic capitalism. Along the way he examines the effect of inequality on our economy, our...
By David W. Rasmussen Objective: This article examines the role Social Security plays in alleviating poverty among retirees in the context of threats to its solvency. Method: Examining long-term employment trends, declining access to defined benefit pensions and saving behavior can determine if in the more future Social Security beneficiaries are likely to be poor. Results: Labor market trends driven by technical change, global competition and increasing demand for services indicate that more future retirees will have lower life-time...
Choosing how to grow your money for a comfortable retirement is a vexing question for many investors – and there doesn’t seem to be a correct answer. Picking the right investment horse to back is tricky and can have lifestyle changing repercussions when you reach retirement age. The favourites are property and pensions, but which one, if either, is best for you? Independent money mag Which? has looked at both and concludes striking a balance between the two rather...
By Julián Messina, Joana Silva This paper documents an inverse U-shape in the evolution of wage inequality in Latin America since 1995, with a sharp reduction starting in 2002. The Gini coefficient of wages increased from 42 to 44 between 1995 and 2002 and declined to 39 by 2015. Between 2002 and 2015, the 90/10 log hourly earnings ratio decreased by 26 percent. The decline since 2002 was characterized by rising wages across the board, but especially among those...
Pensioner poverty, we are often led to believe, is a thing of the past. Apparently, the Baby Boomer generation has been so successful at defending its interests that the greedy old buggers are raking it in. It is claimed that we live in a ‘retirement aristocracy’. Pensioners spend their days jetting off on holiday or sauntering around the golf course. They are sitting pretty in their oversized, overpriced homes. Meanwhile, younger generations are said to be miserably stuck at...
