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We can’t afford to fund our own retirement.

People are living longer and fewer companies are helping workers pay for retirement. How can we afford to stop working? We just won’t.

Thirty-three percent of workers are freelancers now, says a study from investment company Betterment. Sixteen percent plan to keep working freelance jobs to supplement their income in retirement.

The number of freelance workers is expected to grow to 40 percent by 2020. Those planning to work freelance jobs in retirement say their debt is the main reason. Eighty-one percent of freelance workers say their debt is holding them back from saving for retirement.

“The emergence of the gig economy has changed the American workforce,” says Betterment CEO John Stein. “And the way we save for retirement needs to change with it.”

Speaking about necessary retirement saving changes, new research agrees with Stein — not just in the U.S., but around the world.

The changing world creates new retirement saving challenges

An in-depth study on retirement around the world concludes that the traditional retirement system needs to change for future generations. Forty-nine percent of current workers and retirees feel the future generation of retirees will be worse off than they are. And 46 percent of Americans believe the same.

The report titled: The New Social Contract: A Blueprint for Retirement in the 21st Century, addresses the challenges young workers will face in the future for retirement planning. But before going too far into the details, what is a social contract?

The social contract is our traditional expectations of retirement. Meaning, the retirement benefits the government and our bosses have historically provided us. Social Security is fading away and work-sponsored benefits are hard to find. More workers are responsible for funding their own retirement, and they simply can’t afford it on their wages. Here are some of the major concerns U.S. workers are facing…

  • Fewer government benefits: 26 percent
  • Increased life expectancy: 25 percent
  • Changing labor market: 14 percent
  • Volatile stock market: 22 percent

“People are living longer than any time in history and birthrates are declining,” says Transamerica CEO Catherine Collinson. “Employers have been replacing traditional defined benefit pension plans with employee-funded defined contribution retirement plans.”

Collinson continues: “Today, individuals are expected to take on increasing risk and responsibility in self-funding a greater portion of their retirement income.”

Funding your retirement off your wages alone is near impossible. The average amount of money needed to fund a retirement is $1 million to $1.5 million. To come up with that kind of money over the course of a career, many workers invest their income in stocks for profit. The recent climate of the market hasn’t been a safe bet lately. And most investors aren’t letting the ups and downs scare them off.

Stock market volatility is the new norm

Despite current conditions, more Americans are investing in the stock market. Thirty-five percent of Americans are ready to invest, according to life insurer Allianz. That’s up from 26 percent in 2015. However, 37 percent are still anxious about volatility. Their concerns?

Forty-two percent fear there will be a market crash, and 44 percent worry there will be another major recession soon.

“Volatility matters, and while we see some increasing comfort with volatility, it is driving a simmering anxiety in many Americans,” says Allianz VP Paul Kelash. “This anxiety about the negative effects volatility can have on their retirement savings is very real and people are still searching for the right solutions.”

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Meet the Author

Joe Pye

Joe Pye

Associate editor

Pye is the associate editor of



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