What is reported in the study is not only unnecessary, but silly and inaccurate.
Why? Well, unemployment caused by the pandemic is temporary for most workers as is the decline in the stock market.
Most older workers (age 50+) will have time to financially recover. Even if a person just retired and saw a significant drop in their investments, those investments are not consumed all at once, typically 4% per year. The big hit they may have taken in market loss has minimal impact in the short term and even less impact in the long term. In fact, for those still saving for retirement there is an investment opportunity.
A blip in the stock market, even a recession, is not going to cause “high-earning” households (income above $137,700) to fall into poverty, unless they are exceedingly unprepared, shortsighted or just stupid.
“The report claimed all 67 million older workers will see a 7% to 9% percentage point drop in their retirement replacement rates. The numbers show “that middle-class workers are hit by both market loss and job loss, while some high earners will experience dramatic falls into poverty.”
That last claim for high earning households is absurd. A couple with one income at $137,000 retiring in 2020 at age 66 will have a Social Security income alone of $46,476 per year using the Social Security Quick Calculator. That’s not a fully adequate income replacement for most people, but is sure isn’t falling into poverty either.
Here’s the counter view. Are retirees really doomed financially? https://401kspecialistmag.com/is-there-really-a-retirement-crisis/s
NOT TO DIMINISH the severity of recent coronavirus-fueled market events, but it’s not exactly news to note the confusion caused by sensational claims made by the mass media. A lack of accountability and desire for clicks is fueling a frenzy of irresponsible narratives.