Traditional employer-paid pensions, once the gold standard for retirement security, have played an important role in providing retirees with predictable, monthly income for life. But that's changing fast. About 52% of people 65 and older have a pension, but only 5% of those under age 25 do, according to the Federal Reserve. Younger generations must rely on 401(k)s and individual retirement accounts (IRAs).
Traditional pensions remain a key source of retirement income for federal, state, and local workers (retirees with public pensions), and Americans who work at the dwindling number of companies that offer pensions. "If you have a pension, it gives you peace of mind," says Christian Weller, professor of public policy at the University of Massachusetts Boston.
