CHICAGO - Through a combination of procrastination and bad timing, many baby boomers are facing a personal finance disaster just as they're hoping to retire.
Starting in January, more than 10,000 baby boomers a day will turn 65, a pattern that will continue for the next 19 years.
The boomers, who in their youth revolutionized everything from music to race relations, are set to redefine retirement. But a generation that made its mark in the tumultuous 1960s now faces a crisis as it hits its own mid-60s.
There are several reasons to be concerned:
_ The traditional pension plan is disappearing. In 1980, some 39 percent of private-sector workers had a pension that guaranteed a steady payout during retirement. Today that number stands closer to 15 percent, according to the Employee Benefit Research Institute in Washington, D.C.
_ Reliance on stocks in retirement plans is greater than ever; 42 percent of those workers now have 401(k)s. But the past decade has been a lost one for stocks, with the Standard & Poor's 500 index posting total returns of just 4 percent since the beginning of 2000.
_ Many retirees banked on their homes as their retirement fund. But the crash in housing prices has slashed almost a third of a typical home's value. Now 22 percent of homeowners, or nearly 11 million people, owe more on their mortgage than their home is worth. Many are boomers.
By far the greatest shortcoming has been a failure to save. The personal savings rate - the amount of disposable income unspent - averaged close to 10 percent in the 1970s and '80s. By late 2007, the rate had sunk to negative 1 percent. The recession has helped improve the savings rate - it's now back above 5 percent. Yet typical boomers are still woefully short on retirement savings.
Signs of coming trouble are visible on several other fronts, too:
_ Mortgage Debt. Nearly two in three people age 55 to 64 had a mortgage in 2007, with a median debt of $85,000.
_ Social Security. Nearly 3 out of 4 people file to claim Social Security benefits as soon as they're eligible at age 62. The monthly checks are about 25 percent less if you retire at 62 instead of full retirement age, which is 66 for those born from 1943 to 1954. If you wait until 70, your check can be 75 to 80 percent more than at 62.
_ Medical Costs. Health-care expenses are soaring, and the availability of retiree benefits is declining.
_ Employment. Boomers both need and want to work longer than previous generations. But unemployment is near 10 percent, and many have lost their jobs.
The average unemployment period for those 55 and older was 45 weeks in November. That's 12 weeks longer than for younger job-seekers. It's also more than double the 20-week period this group faced at the beginning of the recession in December 2007.