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National Retirement Risk Index

Planning for Retirement: How Much Longer Do We Need to Work?

Originally published June 2012

As the goal of attaining retirement security becomes more difficult to achieve, many aging workers believe that they may never be able to afford to retire.1 There are a number of reasons why a secure retirement is more challenging to achieve for today’s workers. Increases in life spans, lower Social Security replacement rates, lower interest rates, fewer companies providing traditional defined benefit pensions, and individuals not saving enough all play a part in making the challenge more difficult.2

The Center for Retirement Research at Boston College (CRR) conducted research to determine at what age the vast majority of households will be prepared to retire. The points below summarize CRR’s methodology and findings. More detailed results can be found in the CRR Issue Brief “The National Retirement Risk Index: How Much Longer Do We Need to Work?,” by Alicia H. Munnell, Anthony Webb, Luke Delorme, and Francesca Golub-Sass.

The research was based on the CRR’s National Retirement Risk Index (NRRI), which measures the share of American households at risk of being unable to maintain their standard of living in retirement.

The NRRI is constructed using data from the Federal Reserve’s Survey of Consumer Finances. The Index results from comparing households’ projected replacement rates – retirement income as a percentage of pre-retirement income – with target rates that would allow them to maintain their living standard. The NRRI assumes retirees annuitize all of their financial assets.

The results of the research adapt this standard NRRI calculation to address the question of how much longer households need to work.

Prudential is the exclusive sponsor of the National Retirement Risk Index.




1 survey conducted by Harris Interactive, January 2011.
2 Prudential Financial, “Achieving Retirement Security in an Era of Uncertainty,” April 2012.




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