By Chris Adams
Is there a retirement crisis?
For two experts at the U.S. Government Accountability Office, the question comes up over and over – and their answer is that whatever word you use, there are plenty of reasons for concern.
The GAO is Congress’ investigative arm, and over the years it has written a small mountain of reports on the status of the nation’s retirement system – and what might be done about it.
Frank Todisco, chief actuary, and Charles Ford, a senior analyst, talked about the retirement system – from the big picture to the small details. Todisco (and another GAO analyst) recently distilled his thoughts on the overall status of the retirement system in a piece for The Hill, concluding that “while many workers are faring well and saving adequately for retirement, the data indicate that many others are not faring so well.” That makes it difficult to rely on estimates for the “typical” or “average” retiree.
In a session with National Press Foundation fellows, Todisco and Ford discussed three key reports:
- A comprehensive look at the retirement system, assessing Americans’ overall level of retirement preparedness.
- An examination of the Central States Pension Fund, which is now heading toward collapse. That plan has 1,400 contributing employers and about 385,000 participants but is projected to be insolvent within seven years.
- A deep dive into the discount rates that pensions plans use – and should use – when projecting how their investments will grow. Many public and private pension plans have used rosy and unrealistic projections – and therefore could never grow to the size they needed to meet pension obligations.