What has happened to retirement in America over the past decade? To a certain extent, it has become a tale of two very different realities. Remember, in 2010, the economy was just beginning to recover from the worst recession and financial crisis in recent memory, and millions of workers were worried that their retirement plans were ruined.
Now, the landscape is very different. The Employee Benefit Research Institute has developed a model that simulates the percentage of households likely to have adequate resources to meet retirement expenses, and their model shows that the highest-income households have seen their odds of a successful retirement improve sharply during this decade. Middle-income households, meanwhile, have seen some gains, but still have only 50-50 odds of success. But sadly, the lowest-income households have seen their retirement prospects diminish sharply — among these boomers approaching retirement, their odds of success have fallen during the decade from 26 percent to 11 percent.
Just 52 percent of American households owned retirement accounts in 2016, according to Federal Reserve data, not much changed from 2010, when that figure stood at 50 percent. But among households that had workplace retirement plans, the gains have been substantial. According to Vanguard, average account balances jumped 22 percent from 2006 to 2018.