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Retirement, 401(k), Pension Protection Act, Defined contribution plan, Incentives to save, Employee classification, Financial literacy


The United States has been juggling a handful of socio-economic crises lately. The subprime mortgage crisis, the auto industry crisis, the education crisis, the obesity crisis—the list isn’t short and shows no signs of becoming so. Within this group of economically and socially disruptive developments, the “retirement crisis”—the idea that most Americans will lack the financial resources to be secure and relatively satisfied in their golden years—seems somewhat banal because, for the most part, it has yet to hit. Even though baby boomers first started to age out of the workforce in 2011,the real cost of underfunded retirement is far less palpable than are the evictions, layoffs, and stock market fluctuations accompanying other difficult changes.

But the retirement crisis may prove to be one of the most damaging developments facing contemporary America. It invites procrastination, it’s remarkably immune to class and industry distinctions, and it’s actually two exceedingly complex problems. On the one hand, most Americans aren’t saving smartly or aggressively enough while they work, so the pot of money available to them at retirement is markedly insufficient. On the other hand, and regardless of whether they’ve saved enough during their working years, most Americans aren’t properly managing or capable of properly managing their savings after they retire.

These problems are challenging enough in themselves, but they become even more complicated if we focus on solutions that are politically feasible in the United States. For better or for worse, when it comes to welfare state policies, we aren’t Denmark. This doesn’t mean that we shouldn’t reach a little in our efforts to address the retirement crisis—after all, a “crisis” demands “crisis management.” But we need to work towards viable solutions, and we have to keep in mind that no solution is perfect. This Essay is a contribution toward that effort.

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Notre Dame Law Review Online


© 2016 Deepa Das Acevedo.