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Do Baby Boomers Save and, If So, What For?

Are boomers saving enough for their retirement? Contradictory views on this question are reflected in pessimistic reports that boomers save only a fraction of what they need to save in order to maintain their pre-retirement standard of living, and in contrasting optimistic reports that boomers will be substantially better off in retirement than their parents. The purpose of this 30-page Issue Paper by John Gist, Ke Bin Wu, and Charles Ford of PPI is to assess baby boomers' progress in their preparation for retirement by examining what survey data reveal about how much boomers have saved, and their attitudes toward saving. The paper also discusses the measurement of saving and wealth, notable attempts to measure the adequacy of boomer saving, and shortcomings of these attempts. It then explores the question of saving adequacy by comparing changes in wealth relative to income among boomers and by testing the sensitivity of saving adequacy projections to small changes in the assumption underlying the projections.