Burdened by stagnant wages and shrinking employer benefits, average Americans are struggling to save enough for retirement.
The typical worker between the ages of 55 and 64 had $111,000 in retirement savings in 2013, according to Boston College's Center for Retirement Research. In addition, the government says just 18 percent of all private-sector workers participate in pension plans that upon retirement promise to pay them a defined monthly benefit for life. That is down from 35 percent in the early 1990s. Taken together, that adds up to a looming retirement security crisis that is worrying a growing number of activists.
But there is one group that has no such worries: America's top executives. In fact, they enjoy lavish pensions that would otherwise support millions of ordinary workers, according to a report released this week by the Center for Effective Government and the Institute for Policy Studies.
Combined, the 100 largest chief executive retirement funds are worth $4.9 billion - about equal to the entire retirement savings of 41 percent of American families. On average, these CEOs have enough assets salted away to each generate a monthly retirement check of more than $277,000, according to the report.
Many Fortune 500 chief executives pad their platinum-lined nest eggs through prudent use of the nation's tax laws, which many activists say contribute to inequality in retirement savings. The report says these executives managed to stash $3.2 billion away in special tax-deferred accounts that circumvent the annual contribution limits for ordinary 401(k)s. That saved $78 million in taxes.
The report says that 62 percent of working-age African Americans and 69 percent of Latinos have no retirement savings. Meanwhile, 37 percent of whites also have nothing set aside for retirement, leaving them heavily reliant on Social Security.
Overall, nearly half of all workers have no access to any retirement plan at work, and 29 percent of workers between ages 50 and 64 have neither pensions nor retirement savings.
The report says policymakers should look at ways to close the imbalance. Among the ideas:
- End unlimited tax-deferred compensation for executives.
- Cap tax-deferred corporate-sponsored retirement accounts at $3 million.
- Eliminate tax breaks for companies that offer pension plans and other retirement benefits.
- Expand Social Security.
"These massive nest eggs are not the results of CEOs working harder or investing more wisely," the report says.
© 2015 The Washington Post
The typical worker between the ages of 55 and 64 had $111,000 in retirement savings in 2013, according to Boston College's Center for Retirement Research. In addition, the government says just 18 percent of all private-sector workers participate in pension plans that upon retirement promise to pay them a defined monthly benefit for life. That is down from 35 percent in the early 1990s. Taken together, that adds up to a looming retirement security crisis that is worrying a growing number of activists.
But there is one group that has no such worries: America's top executives. In fact, they enjoy lavish pensions that would otherwise support millions of ordinary workers, according to a report released this week by the Center for Effective Government and the Institute for Policy Studies.
Combined, the 100 largest chief executive retirement funds are worth $4.9 billion - about equal to the entire retirement savings of 41 percent of American families. On average, these CEOs have enough assets salted away to each generate a monthly retirement check of more than $277,000, according to the report.
Many Fortune 500 chief executives pad their platinum-lined nest eggs through prudent use of the nation's tax laws, which many activists say contribute to inequality in retirement savings. The report says these executives managed to stash $3.2 billion away in special tax-deferred accounts that circumvent the annual contribution limits for ordinary 401(k)s. That saved $78 million in taxes.
The report says that 62 percent of working-age African Americans and 69 percent of Latinos have no retirement savings. Meanwhile, 37 percent of whites also have nothing set aside for retirement, leaving them heavily reliant on Social Security.
Overall, nearly half of all workers have no access to any retirement plan at work, and 29 percent of workers between ages 50 and 64 have neither pensions nor retirement savings.
The report says policymakers should look at ways to close the imbalance. Among the ideas:
- End unlimited tax-deferred compensation for executives.
- Cap tax-deferred corporate-sponsored retirement accounts at $3 million.
- Eliminate tax breaks for companies that offer pension plans and other retirement benefits.
- Expand Social Security.
"These massive nest eggs are not the results of CEOs working harder or investing more wisely," the report says.
© 2015 The Washington Post
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