Retirement Income Deficit in U.S. is $6.6 Trillion

American workers lack necessary funds and savings needed to properly retire, to the tune of $6.6 trillion. (Courtesy of Photos.com)

America’s “Retirement Income Deficit”—the disparity between what Americans should have compared with what they actually have in retirement savings to pay for future needs—is approximately $6.6 trillion, according to calculations done by the Center for Retirement Research at Boston College. The figure was released by Retirement USA, a group advocating for a “universal, secure, and adequate retirement system.”

One reason why the gap is so large is the economic downturn’s effect on pensions and income. “The key sources of income that retirees have relied on are either under attack — in the case of Social Security – or disappearing – in the case of traditional pensions,” said Ross Eisenbrey, Vice President of the Economic Policy Institute in a statement.

The Retirement Income Deficit projection is based on holistic data of retirement income and wealth of Americans aged 32 to 64. The real deficit may actually be much higher than $6.6 trillion due to changing economic factors and policies, Retirement USA said.

“It is important to remember that $6.6 trillion is a conservative figure. Using other assumptions, it could be much higher. … Cuts to Social Security, pension freezes, and 401(k) losses on the stock market could easily make the Retirement Income Deficit much, much worse in the future,” said Maria Freese, director of government relations and policy for the National Committee to Preserve Social Security and Medicare.