Solving the Retirement Dilemma
Politicians have started talking about and proposing solutions to a retirement crisis that they say is looming over the horizon. The proposals offered diverge in two directions, with one party wanting to increase Social Security benefits while the other pledges to repair the solvency of the system. The true problem in this discussion may not even be where they say it is, in fact the whole problem may be fabricated by misunderstanding the data that they are pulling from. One of the more common ways to measure how well off people are in retirement is to compare their retirement income to the income of their last year in work. This may not be the best way to compare incomes as the last year of work is often times closer to one’s maximum yearly earnings. For more information on this subject, visit this article by Andrew Biggs with The Wall Street Journal.