The Economy's Lasting Impact on Your Retirement

Economic declines shortly before retirement can permanently decrease retirement income.

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Fewer employer guarantees. The two decade-long shift from guaranteed traditional pensions to do-it-yourself 401(k)'s continued during the most recent economic downturn. And many workers have recently learned that even a 401(k) match is far from permanent. At least 267 employers reduced or suspended their 401(k) match in 2009, according to the Pension Rights Center. Only a handful of the companies have since reinstated their employer contributions. "Fewer employers these days can afford to offer lifetime pension benefits, which means retirees will need to look elsewhere for longevity protection," says Mitchell. As life expectancies continue to lengthen, guaranteed assets including a paid off home, Social Security, traditional pensions, and annuities are becoming increasingly important for retirement security. "I fully expect to live to 100 and don't want to eat cat food if I can help it," says Mitchell. "So guarantees sound appealing to me for a portion of my retirement assets."