New Retirees May be Better off Financially than Prior Generations

Based upon a study by the Investment Company Institute, “on average, more-recent generations of households have higher levels of resources to draw on in retirement than previous generations.”

The shift to defined contribution plans like 401(k)s, from the defined benefits plans enjoyed by prior generations, should increase retirement resources for most households.  Furthermore, other assets, such as home-equity, may constitute approximately one-third of near-retirees’ net worth.  This equity may be tapped later if needed (e.g. through a reverse mortgage) during retirement as well.  So, for retirement savers, mixing up savings and investment vehicles is usually the best idea.

Click here to learn more about the Investment Company Institute study findings.

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