It's well-known that New York City is one of the most expensive environments in the United States. And those high costs of living mean that a third of New Yorkers simply won't be able to afford to retire, according to a new study.
New York City comptroller John C. Liu's study, "Are New Yorkers Ready for Retirement," conducted in association with the Schwartz Center for Economic Policy Analysis at The New School, suggests NYC residents are in for a tough time as they contemplate retirement.
The study's starkest finding: More than a third of New York City households where the head is near retirement age will have to subsist almost entirely on Social Security income or will not be able to retire at all due to the fact that they have less than $10,000 in savings.
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As well, only 35 percent of New York City workers participated in an employer-based retirement plan in 2009.
The study also found that between 2000-2009, the percentage of employees in New York City who had access to employer-sponsored retirement plans declined from 48 percent to 40 percent – below the U.S. average, which is 53 percent (2009).
"It is a significant public policy concern when such a high proportion of the workforce will not have enough money in their retirement years," Comptroller Liu said. "This report focuses attention on the need to help workers, both public and private sector, properly prepare throughout their working careers for their eventual retirement."
The report found that employers have become less willing or able to sponsor pensions – a trend that is true across most industries and occupations, and affects New Yorkers of nearly all ages and income groups. The brewing retirement crisis cuts across racial, ethnic and gender lines.
"The deck is becoming increasingly stacked against New Yorkers in their efforts to retire," said SCEPA Director Teresa Ghilarducci, Ph.D. "Fewer New Yorkers have access to the convenience and affordability of employer-sponsored retirement plans. More and more residents now face a choice between retiring into poverty or continuing to work in old age. Without significant policy reforms, the economic tea leaves foretell a decrease in the standard of living for retired New Yorkers."
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