40% of Older Workers and Their Spouses Will Experience Downward Mobility

Inadequate retirement accounts will cause 8.5 million middle-class older workers and their spouses to be downwardly mobile, falling into poverty or near poverty in their old age.

Key Findings:

Two in five – or 40% – of older workers and their spouses will be downwardly mobile in retirement.
If workers ages 50-60 retire at age 62, 8.5 million people are projected to fall below twice the Federal Poverty Level, with retirement incomes below $23,340 for singles and $31,260 for couples.
2.6 million of 8.5 downwardly mobile workers and their spouses will have incomes below the poverty level – $11,670 for an individual and $15,730 for a two-person household.
A typical single worker in the middle 40% of earners (earning $25,000-$64,000) can expect an annual income of $18,000 if they retire at age 62, the most common age of retirement.
Couples in the middle 40% of earnings (earning $44,000-$105,000) can expect an annual income of $29,500 if workers retire at age 62.

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SCEPA’s Retirement Equity Lab (ReLab) , led by economist and retirement expert Teresa Ghilarducci , researches the retirement crisis that exposes millions of American workers to downward mobility in retirement. ReLab is part of the Schwartz Center for Economic Policy Analysis (SCEPA) , an economic policy research center within The New School’s Department of Economics. This report was originally posted by SCEPA on February 14th.