[lbo-talk] 2 Fed Reserve economists: Amerians saving TOO much for retirement, gosh darnit!

B. docile_body at yahoo.com
Mon Feb 19 04:13:02 PST 2007


http://finance.yahoo.com/expert/article/moneyhappy/24438

Rethinking Retirement Savings (or Not) by Laura Rowley

[...]

Now a group of economists is offering a wildly contrarian view: People may be saving too much for their retirement. A few go so far as to suggest that the financial services industry is deliberately encouraging over-saving because it profits from managing such assets.

Consider a recent study conducted by Paul Smith and Lucy McNair of the Federal Reserve Board, and David Love, an economist at Williams College. They found that 88 percent of all households with breadwinners over age 51 had accumulated sufficient resources to finance adequate consumption in retirement.

A separate study by John Karl Scholz, an economist at the University of Wisconsin, Madison, and two other researchers found more than 80 percent of households headed by Americans born between 1931 and 1941 have accumulated their optimal wealth targets for retirement.

The other 20 percent missed their goal by a relatively small margin, according to the study published in the Journal of Political Economy.



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