How Do Pensions Affect Replacement Rates?



Do today’s retirees have sufficient income to meet their needs? One common way to address this question is to determine a household’s “replacement rate.” The replacement rate gauges the extent to which retirement income allows workers to maintain their pre-retirement standard of living. This brief is the second in a series examining replacement rates for current retirees. The first one looked solely at Social Security, the single most important source of retirement income. This brief adds employer-sponsored pensions and household saving outside of employer plans to provide a more comprehensive picture of replacement rates. A final brief will consider how the addition of housing equity may affect replacement rates.

The CRR wants to hear from our website users like you. Would be you willing to take a short survey?

Yes, take me to it.       No, thanks.      Not now, but ask me later.