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The Retirement Cliff

The Retirement Cliff. How Average Are You?. How Average Are You?. Are you religious? Can you name the three stooges? How about the 3 branches of government? Do you have a college degree? Do you take a bath, or a shower? Do you own equities?. Do you live in the state where you were born?

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The Retirement Cliff

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  1. The Retirement Cliff

  2. How Average Are You?

  3. How Average Are You? Are you religious? Can you name the three stooges? How about the 3 branches of government? Do you have a college degree? Do you take a bath, or a shower? Do you own equities? Do you live in the state where you were born? How many children do you have? Do you eat peanut butter? Do you floss? How about exercise? Do you recycle? Any shopping at Walmart?

  4. How Average Are You? Believe God exists (80%) Larry, Mo, Curly (& Schemp) (89%) Legislative, Judicial, & Executive (20%) Does NOT have a college degree (63%) Take a bath or shower (10.4 minute shower, daily) Own stocks?( 50/50) Live in same state (60%) Have 2 children Eat 3 lb’s of PB per year Do NOT floss regularly (90%) Exercise once a week Recycle (50%) Shop At Walmart at least Annually (80%)

  5. Selected “Average” Statistics Drinks 55 gallons of soda a year Does not wash his hands properly after using public restrooms Throws away more than 100 lbs of food per year 25% of Americans over 18 abstain from alcohol for life 69% of Americans go to the movie theater at least annually

  6. The Average AmericanFederal Reserve Survey of Consumer Finance Data Source: Federal Reserve, Survey of Consumer Finances

  7. If You Are Above Average Financially, You Will Be Asked to “Help”… Because Others Need It

  8. Who We Will Support in the Future 5,000 4,500 4,000 3,500 3,000 2,500 1910 1920 1930 1940 1950 1960 1970 1980 1990 Year Population currently over 65 65-81 yrs old Thousands

  9. Why 65? “Age 65 is generally set as the threshold of old age since it is at this period of life that the rates for sickness and death begin to show a marked increase over those of the earlier years” -IssacRubinow, 1916 “It is a commonplace fact that physical ability, mental alertness and cooperativeness tend to fail after a man is 65” -Federal Government before the Supreme Court, 1936

  10. How to Fund Retirement The Three Legs of the Retirement Stool- Social Security Personal Savings Pensions

  11. Social Security Currently running a deficit, will exhaust trust fund by 2033 Will bring in enough tax revenue to pay roughly 75% of liabilities Then what?

  12. Social Security • Increase income subject to taxation • Increase retirement age • Means test • Reduce Cost of Living Adjustments (COLAs)

  13. Social Security • Who gets hit the hardest? • Those with income to tax or higher levels of assets and earnings

  14. Personal Savings

  15. Percent of Workers by Total Amount of Retirement Savings 2011 Source: Employee Benefit Research Institute, Dent Research

  16. Percent of Workers and Retirees by Total Amount of Retirement Savings 2011 Source: Employee Benefit Research Institute, Dent Research

  17. Percent of Workers and Retirees by Total Amount of Retirement Savings 2011 Source: Employee Benefit Research Institute, HS Dent Research

  18. Public Pensions

  19. State Pension Funding Levels 2012 Source: Pew Center, 2012

  20. Funding for Retiree Health Benefits, 2012 Source: Pew Center, 2012

  21. Comparing Pension & OPEB Funding and Liabilities State Pensions $3.06 Trillion $759.7 Billion $2.31 Trillion Retiree Health Benefits $659.6 Billion $32.4 Billion $659.6 Billion Source: Pew Center, 2012

  22. State Pension Reforms 2010 Source: Pew Center, 2012

  23. How Budgets Were Balanced Source: Center on Budget and Policy Priorities 2012

  24. Cuts in Services by Number of States and Category Source: Center on Budget and Policy Priorities 2012

  25. Tax Increases by Sector and Number of States Source: Center on Budget and Policy Priorities 2012

  26. How States Closed Budget Gaps by Cutting College Funding Florida drastically reduced funding of higher education, which means less allocation to colleges. The 2012 tuition increase was 15%. From 2009 – 2012, the tuition increase was52%. California has cut higher education by over $1 billion. Cal State increased tuition in 2012 by 18%. From 2008 through 2012, Cal State increased tuition by 80%.

  27. City Pensions, Funded vs. Un-Funded Source: Pew Center, 2013

  28. Pension Funding: Cities vs. States Source: Pew Center, 2013

  29. And People Are Moving, So Fewer Left to Pay Taxes

  30. United Van Lines Migration Patterns 2007 Source: United Van Lines, via Unigroup, Inc.

  31. United Van Lines Migration Patterns 2009 Source: United Van Lines, via Unigroup, Inc.

  32. United Van Lines Migration Patterns 2010 Source: United Van Lines, via Unigroup, Inc., 2011

  33. United Van Lines Migration Patterns 2012 Source: United Van Lines, via Unigroup, Inc., 2012

  34. Top 10 Outbound States2012 Source: United Van Lines, via Unigroup, Inc., 2012

  35. Top 5 Inbound States2012 Source: United Van Lines, via Unigroup, Inc., 2013

  36. Top 5 Inbound States2012 Source: United Van Lines, via Unigroup, Inc., 2013

  37. Many Outbound States are High Cost, High Tax Venues

  38. Don’t Look to Your Kids to Support You – the Employment Picture is Tough

  39. Drop in Pay for Re-Employed % of Re-Employed That Lost Pay Amount of Pay Reduction Data Source: “Out of Work and Losing Hope: The Misery and Bleak Expectations of American Workers,” Cliff Zukin, Carl Van Horn, Charley Stone. 9/2011

  40. Drop in Pay for Re-Employed by Age % of Re-Employed Amount of Pay Reduction Data Source: “Out of Work and Losing Hope: The Misery and Bleak Expectations of American Workers,” Cliff Zukin, Carl Van Horn, Charley Stone. 9/2011

  41. Comparing Jobs Lost to Jobs Gained Use a matrix of three levels of pay to compare jobs lost to those gained (each a third of 2008 employment) - Lower wage - $7.69/hr. to $13.83/hr ($16,049 to $28,863) Median wage - $13.84/hr to $21.13/hr ($28,884 to $44,098) Upper wage - $21.14/hr to $54.55/hr ($44,119 to $113,845)

  42. Comparing Jobs Lostto Jobs Gained Lower-wage occupations were 21 percent of recession losses, but 58 percent of recovery growth. Mid-wage occupations were 60 percent of recession losses, but only 22 percent of recovery growth. Higher-wage occupations were 19 percent of recession job losses, and 20 percent of recovery growth.

  43. Comparing Jobs Lostto Jobs Gained

  44. Comparing Jobs Lostto Jobs Gained

  45. Comparing Jobs Lostto Jobs Gained

  46. Comparing Jobs Lostto Jobs Gained

  47. Comparing Jobs Lostto Jobs Gained ` `

  48. Employment of RecentCollege Grads

  49. The Face of the Recovery

  50. Job Additions by AgeChange Since June 2009 In Thousands Data Source: Bureau of Labor Statistics, 2014

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