Retirees hoping to live on the proceeds from their 401(k) savings or similar venues are due for a big surprise, according to John Bogle, founder of The Vanguard Group, as such holdings aren't enough to sustain a decent lifestyle, which puts many aging Americans ill prepared for retirement.
In an interview with USA Today, when asked what worries him the most, Bogle replied "the coming train wreck in the financial system."
Too many people have not prepared enough for retirement.
Editor's Note: See the Disturbing Charts: 50% Unemployment, 90% Stock Market Crash, 100% Inflation
"A 401(k) is a thrift plan trying to be a retirement plan. It was never designed to be a retirement," Bogle told the newspaper.
"To be a retirement plan, you have to keep putting money in and can't be allowed to take money out, and you can't be allowed to borrow from it. And if you change jobs, you should be able to take it with you to your new job. The reality is that probably 70 percent of the citizens of this country will rely entirely on Social Security."
Meanwhile, more and more Americans are giving up hope of ever retiring.
About 35 percent of Americans don't expect to retire, up from 29 percent two years earlier, according to findings from the 2011 Risks and Process of Retirement Survey Report from the Society of Actuaries, The New York Times reported recently.
Four in 10 of the survey's participants nearing retirement age said they won't retire say because they are financially unable to do so, as they either need the income or the employer benefits.
“There is a core group of people earning a paycheck who feel, for whatever reason, they aren’t going to be able to support themselves in their retirement years,” said Carol Bogosian, an actuary and retirement expert, The Times reported.
Editor's Note: See the Disturbing Charts: 50% Unemployment, 90% Stock Market Crash, 100% Inflation
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