Americans Delay Retirement

This is the title of a very interesting article recently published in the WSJ - thanks Rick for telling me about it.
I wasn’t that impressed with the article’s tag lines

As Housing, Stocks Swoon - Nest Eggs Shrink, Deferring Dreams; 'Freaked Out' Elite.

More appropriate for the US equivalent of a “red top” than its main financial paper.

The bottom line of the article is that as property prices fall and stock markets erode their savings, many older Americans are delaying retirement. A recent Schwab survey of its financial advisers found that nearly a quarter of clients were considering working longer, specifically because of the economic fallout of the past 12 months.

Like the UK, the concept of a company pension scheme is quickly becoming the exception than the rule. Over the past three decades, the 401(k) plan (The UK’s equivalent of “Money Purchase” scheme) has gradually replaced pension plans as the main source of retirement coverage for U.S. workers in the private sector. In 1979, 62% of U.S. employees participated only in a pension plan. By 2005, 63% of workers only participated in a 401(k) plan. The trouble with these schemes is that they are exposed to the fluctuations in the world’s equity markets. Not a nice thought.

I have yet to think through the implications of a widespread delay of people leaving the workforce. Needless to say its impact will be significant.

I am note sure if you can still read the article (The WSJ is a subscription paper) – here is the link. Dick Stroud