Shifting the Retirement Paradigm: Moving toward Lifetime Financial Security
During the past two years, the Milken Institute has focused on how Americans manage lifetime financial security leading to a financially secure retirement. The Institute has delved into this topic by conducting research, meeting with experts, and holding convenings. The Institute held an initial convening in 2021 focused on issues of aging and the intersection of retirement security. It was followed by two private roundtables and one public session at the 2022 Global Conference focused on retirement and financial security issues. In October 2022, the Institute held a private, half-day policy convening—A Framework for Action: Strategies for Enhancing Retirement Security. Contributors included a variety of experts, such as retirement and financial security leaders from top financial services firms, insurance company experts, FinTech firm leaders, researchers, and policy leaders. And sessions at the 2023 Global Conference covered FinTech and Other Innovative Solutions to Enhance Lifetime Financial Security and Addressing the American Retirement Crisis.
Distinct from other reports on financial security, this report is a landscape piece that analyzes the majority of the factors that relate to financial security over time. Further, it defines lifetime financial security and calls for paradigm shifts. Each section of the report outlines relevant issues, recent developments, and areas where change is needed or has occurred. The report describes challenges and presents actionable recommendations for consideration by policymakers, the private sector (including financial firms and employers), and individual Americans of all ages who are thinking about how to ensure their long-term financial security.
It highlights and analyzes developments, such as state-facilitated retirement plans, the SECURE 2.0 Act, and FinTech solutions that make long-term saving easier and more accessible. It also highlights the power of compounding and the need for financial education and beginning to save and invest at an early age. The report discusses other important topics, such as addressing financial inequality, saving for medical and long-term care costs, and individual behavioral biases that impact long-term saving and investment decision-making.
The report also addresses the work landscape, calling on employers to change hiring practices and work environments to promote longer working lives, value multigenerational workforces, and increase retraining opportunities for senior workers.
The report concludes with a resource guide in the Appendix outlining retirement planning considerations for individual savers.