My pop was a bus driver for 25 years. Once he reached retirement, I would have loved Mom and Pop to relocate to D.C. to live with me. But they loved their life and community and wanted to age in their own home — just like millions of Americans.
The U.S. Department of Labor is paving the way for states to sponsor retirement plans for millions of private-sector workers who don’t have such programs on the job.
Workers 50 and older face a hurdle that younger peers don’t: how to overcome negative stereotypes that paint them as much more expensive, out of touch with technology and less productive.
For decades, the three-legged stool was the metaphor for funding retirement: Social Security, pensions and savings/investments. Because of the recession and drop in pensions, the stool started to shake. That hasn’t escaped the notice of our adult children as they watch parents head into retirement.
This month, state legislatures throughout the nation are convening to mark the inauguration of new governors, state legislators and other state leaders. We will then begin to hear State of the State messages from governors that detail the challenges, opportunities and priorities they have defined for the year ahead.
Congress recently carved a hole in a 40-year-old pension law that has prevented employers from cutting benefits earned by those already retired. This change applies to people covered under multiemployer plans that are in critical financial shape.
Studebaker auto workers found out the hard way in 1963. When the Studebaker Corp. shut down its plant in South Bend, Ind., workers who had been promised pensions saw their hard-earned benefits vanish in an instant. Instead of receiving fixed payments throughout retirement, thousands of employees were forced to take one-time lump sums worth a fraction of what they’d earned. Thousands more received no benefits at all. The Studebaker Corp. had been promising pension benefits to its employees, but in reality it was putting away no money to fund these pensions — and it wasn’t alone.
My Pop, a bus driver in Buffalo, worked until the mandatory retirement age of 70. He and my Mom lived on Social Security along with his modest pension. One Christmas, Pop couldn't get into the spirit of the season. The next day, he confided that the next year health care premium increases would consume his entire pension check, and then some. I can only imagine how my parents' lives would have been affected if Pop's pension had been cut in retirement.
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