A wintery mix of news about retirement savings over the past few weeks. There’s some variation in the details but a consistent underlying message, which is that you will die poor, Boomer. And your generation will likely impoverish the generations coming after it.

(Here’s the upside: we are told by a study of cheery Germans that having pessimistic thoughts about the future will help you live longer and more happily. So bum out, and look forward to a protracted, satisfied and destitute life.)

Let’s start with the big picture, and then narrow down on the olds. The Wall Street Journal reports on a study from the Employee Benefit Research Institute, which found that “fifty-seven percent of U.S. workers surveyed reported less than $25,000 in total household savings and investments excluding their homes.”  The same study found that only 66 percent of workers “have saved for retirement”—meaning a third of America has nothing set aside for its dotage.

This is roughly in line with the results of the last Wells Fargo Retirement Survey, which found that middle-class “Americans say they will need a median of $300,000 to support them in retirement, but to date, have only saved $25,000 (median).”

The Wells Fargo survey also contained at least two staggering examples of magical thinking:

  • Thirty percent of Americans think they’ll need to work at least until they turn 80. This is not feasible. You can work to 80 if you have a job where you sit in a recliner. Or if you own a gas station in North Dakota in 1940, and just leave a coffee can in the office where your trusted customers can toss in the money they owe you. Otherwise, you’ll be lucky to work till you’re 62.
  • (Side note:  the 30 percent who plan to work until they turn 80 is approximately the same number of Americans who have saved nothing for retirement, so the takeaway might be that a third of your countrymen and women see no ability to save anything and need to labor in the salt mine until they die.)
  • And this: “Thirty-four percent of middle class Americans” (note that: middle class, not all) “estimate their retirement income will consist of 50 percent or less of their current annual income.” In other words, they plan to get along on about $26,000 a year. Which is poverty level, give or take.

The outlier here comes from TD Ameritrade, which released its own appraisal of the looming retirement crisis earlier this month. This makes for riveting reading if you like surveys and statistics and prophecies of doom. And you do. Because you are old and believe in the joy that comes from pessimistic thinking. (See above, if you’re skipping around in this story.)

A couple of key points from TD Ameritrade:

  • “Although there is great variability in the amount Baby Boomers currently have saved, the median amount saved ($275,000) is far below what they believe they need ($750,000).” In other words, they are looking at a stark shortfall of $475,000.
  • Among non-retired Baby Boomers, 64 percent feel they are “financially prepared for retirement.”
  • These so-called “Prepared Boomers” think they’ll need to set aside a bit more; their target nest egg is $800,000. They have set a higher standard, and they have failed to achieve it. “Prepared Boomers still have, on average, 50% less than they believe they will require (i.e., they have a median of $400,000 saved and believe they require $800,000).” So, in other words, the Boomers who believe they are financially prepared are in their own estimation also woefully unprepared. We are an amazing species.

The studies appear to have very inconsistent findings about the financial reserves of the least prepared Boomers. TD Ameritrade found that 29 percent of the respondents claimed they were unprepared for retirement, but even these folks had $99,500 set aside. This contrasts with the Employee Benefit Research Institute study which found the bottom third had set aside nothing. The difference might be that TD Ameritrade was measuring Boomers (who’ve presumably been saving for decades) and the EBRI looked at all ages.

Interpreting the data is complicated, but the Motley Fool has an interesting take on the TD Ameritrade results: “Based on the 4% rule for retirement withdrawals, a retiree with a $275,000 nest egg in a well-diversified portfolio can withdraw $11,000 each year, indexed for inflation, and likely not outlive his or her money. With the average retiree’s Social Security check of $1,264.88 a month adding around another $15,179 a year, the typical boomer, retiring today, would have just over $26,000 a year to live on.”

So, again, poverty. But it gets worse: “Still, even those numbers, as bleak as they are, may be wildly optimistic for boomers. For one thing, abysmally low bond yields, and the incredible volatility in the stock market over the past decade, are calling into question whether that 4% rule still works today. The current safe withdrawal rate may actually be lower than 4% — increasing the likelihood that you could deplete your savings by withdrawing at that old presumably safe level.”

And meanwhile, your life expectancy is getting longer (at least until the next bird flu hits). So you’ll eventually be left with nothing but Social Security until it’s busted or your grandchildren are living in dumpsters to keep it afloat. And somewhere along the way, Medicare will become a name applied to something not at all like what we have today.

So, a recommendation: Don’t be pessimistic about this. Get happy. It will shorten your life, you’ll have fewer years of penury, and you’ll be less of a burden on others.

Photo: Vaudevillian Ernest Hare listens to the radio, c. 1921 – 1925, from the Bain News Service via Library of Congress website.