Happy Days Are Here Again for Wall Street but Main Street Is Too Poor to Retire

Posted by Joshua Holland, AlterNet at 10:01 AM on October 22, 2009.

Goldman Sachs just posted profits of more than 5 bucks per share. Goldman's people will take home more in bonuses this year than at any point in its 140 year history.  Goldman's not alone -- the whole financial sector is up!

My mother is a social worker. She's worked steadily since she was 14 years old. She was looking forward to retiring last year and thought she had it all worked out -- social security, a very small pension from the state in which she works and a modest collection of acorns in her 401(k) were going to allow her some dignified Golden Years. Not luxurious, just dignified.

That was then. Her 401(k) took a deep hit in the financial crisis. Now she's working a part-time job to make ends meet. Because of budget cuts, she just lost that and has been put "on call."

She's not alone, according to a new study (HT: Steven D.):

More Americans plan to delay retirement following steep drops in the value of their savings accounts, data from several new surveys show.

A study to be released on Thursday by Canadian insurer Sun Life Financial Inc found 65 percent of U.S. workers plan to stay on the job at least one more year than planned, an 11 percentage point increase from a similar survey in January.

"There is a huge drop in confidence that has taken place," because of the fall of stock markets since 2007, Wes Thompson, president of Sun Life's U.S. division, told Reuters in an interview. At the same time, longer life expectancies mean individuals need to build up more savings before they stop working.

"It's not retire at 65, get ready to die at 70," Thompson said.

The survey was conducted in September of 2009, when stock markets had already begun their recovery.

Also, a forthcoming study by Prudential Financial Inc found that 66 percent of respondents over the age of 45 said they may need to work longer than expected to afford retirement.

And a recent survey by mutual fund giant Vanguard Group Inc of Pennsylvania found that 45 percent of American investors said putting off retirement was "possible" and the figure was nine percent points higher among people in their fifties.

Tagged as: economy, retirement, goldman sachs, executive compensation