Retirement. A time to retreat from the troubles of the world to a life of rest and relaxation. Right? Well, not necessarily.
While today’s retirees are living longer, more active lives than their predecessors, many are experiencing financial difficulty. Findings of a December 1995 study, conducted by the Employee Benefit Research Institute, show that although most working adults believe their lifestyles will improve with retirement, retirees are finding that their standard of living has actually declined.
All of this — plus uncertainty over whether Social Security will be able to make good its promises — have meant that financial experts urge everyone to begin planning their retirement almost as soon as they begin working, with the centerpiece of that planning being pension accounts.
For most college and university employees — faculty, administrators and support staff — the most common choice they, face regarding employer-sponsored pension plans is whether to choose a defined benefit or a defined contribution plan. The choice they make depends on such disparate factors as whether they plan on staying at their institution throughout their careers and how much they are willing to see their pensions fluctuate with the stock market.
