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Traditional defined benefit pensions, once a major source of retirement income, are increasingly giving way to tax-qualified defined contribution (DC) plans and individual retirement accounts (IRAs). This trend is likely to continue among future retirees who have worked in the private sector. This article discusses the implications of those trends for the measurement of retirement income. We conclude that Census Bureau's Current Population Survey (CPS), one of the primary sources of income data, greatly underreports distributions from DC plans and IRAs, posing an increasing problem for measuring retirement income in the future. The CPS and other data sources need to revise their measures of retirement income to account for periodic (irregular) distributions from DC plans and IRAs.

This research note uses 2007 Survey of Consumer Finances (SCF) data to update the authors' work reported in a prior article, which used earlier data to assess debt levels among households approaching retirement in 1995 and 2004. The authors assess whether there have been changes in the debt holdings of near-retirees in 2007, a point in time reflecting the start of the recent financial and economic crisis. Results show that debt levels of near-retirees were modestly higher in 2007 than in 2004, overall and across several subgroups. The results reinforce a general finding of the original article that current near-retirees, primarily baby boomers, are approaching retirement with more debt compared with their counterparts in the mid-1990s. Because the 2007 SCF data captures only the beginning of the current recession, the authors expect future trends to differ from the results presented here.

This article uses the Federal Reserve Board's Survey of Consumer Finances to examine the debt holdings of near-retirees (aged 50-61) in 1995 and 2004. Employing a variety of measures of household borrowing, we find that near-retirees in 2004-the leading edge of the baby-boom cohort--had more consumer and housing debt than their counterparts in 1995. We observe a modest increase in the median debt service and debt-to-assets ratios between the two cohorts, but no statistical difference in the average ratios. Analysis of several demographic and socioeconomic subgroups reveals certain population segments, such as households headed by single women, with significantly higher debt service ratios in 2004. We discuss the implications of these trends for the retirement income security of older baby boomers and suggest further avenues of research.