Report to the Ranking Minority 

Member, Subcommittee on EmployerEmployee Relations, Committee on 

Education and the Workforce, House of 

Representatives 

United States General Accounting Office 

GAO 

April 2003 RETIREMENT 

INCOME 

Intergenerational 

Comparisons of 

Wealth and Future 

Income 

GAO-03-429 
Baby Boom and Generation X households headed by an individual aged 25 to 

34 have greater accumulated assets, adjusted for inflation, than current 

retirees had when they were the same age, but also more debt. Most of the 

large increase in assets between current retirees and the Baby Boom is due 

to increased ownership and equity in housing. Contributions to defined 

contribution pension plans play a role in explaining the modest increase in 

assets between the Baby Boom and Generation X, in part, because GAO’s 

data do not allow it to consider the value of benefits from defined benefit 

pension plans. 

Workers from Generation X are estimated to have similar levels of 

retirement income in real terms (adjusted for inflation) at age 62 as their 

counterparts in the Baby Boom, but Generation X may be able to replace a 

smaller percentage of their preretirement income. Whether Social Security 

benefits for Generation X are higher or lower than those for the Baby Boom 

will depend on how the Social Security funding shortfall is resolved. With 

regard to pensions, Generation X and the Baby Boom are estimated to have 

similar levels of pension income even with a continued shift from defined 

benefit to defined contribution pension coverage. 

Retirement income will vary within both Generation X and the Baby Boom 

households, and certain groups will be more likely to have lower retirement 

incomes. As one might expect, given significant variation in workers’ 

earnings, if households were arrayed from lowest to highest in terms of 

estimated total retirement income, those in the top 20 percent would receive 

a substantially larger proportion of income compared with those in the 

bottom 20 percent. Retirement income is lower for the less educated and 

single women. 

Percentage of the Aged Receiving Income, by Source 

0 20 40 60 80 100

Earnings

Government Pensions

Private Pensions

Asset Income

Social Security

Percentage of aged

2000

1962

Source: Fast Facts and Figures About Social Security, Social Security Administration, 2002.

Source

69

90

54

59

9

29

9

14

36

22

Today’s workers will rely to a large 

extent on Social Security, private 

pensions, and personal wealth for 

their retirement income. But some 

analysts question whether these 

sources will provide sufficient 

retirement income to maintain 

workers’ standards of living once 

they leave the labor force. Indeed, 

the Social Security trust funds are 

projected to become exhausted in 

2042, at which time, unless action 

is taken, Social Security will not be 

able to pay scheduled benefits in 

full. 

To gain an understanding of what 

today’s workers might expect to 

receive in terms of retirement 

income, GAO was asked to 

examine (1) how the personal 

wealth of Baby Boom (born 

between 1946 and 1964) and 

Generation X (born between 1965 

and 1976) workers compare with 

what current retirees had at similar 

ages, (2) how workers from the 

Baby Boom and Generation X 

compare in terms of the pension 

and Social Security benefits they 

can expect to receive, and (3) the 

likely distribution of pension and 

Social Security benefits across 

workers within the Baby Boom and 

Generation X. 

www.gao.gov/cgi-bin/getrpt?GAO-03-429.

To view the full report, including the scope 

and methodology, click on the link above. 

For more information, contact Barbara D. 

Bovbjerg at (202) 512-7215. 

Highlights of GAO-03-429, a report to 

Ranking Minority Member, Subcommittee 

on Employer-Employee Relations, 

Committee on Education and the 

Workforce, House of Representatives 

April 2003

RETIREMENT INCOME 

Intergenerational Comparisons of Wealth 

and Future Income 
Page i GAO-03-429 Retirement Income 

Letter 1

Results in Brief 3

Background 5

Baby Boom and Generation X Workers Have More Assets and More 

Debt Than Current Retirees Had at Similar Ages 13

Generation X and the Baby Boom Are Estimated to Have Similar 

Levels of Real Retirement Income, but Generation X Could Have 

Lower Replacement Rates 22

The Distribution of Retirement Income Will Vary within 

Generations, and Certain Groups Will Be More Likely to Have 

Lower Retirement Incomes 27

Concluding Observations 35

Agency Comments 36

Appendix I Scope and Methodology 38 

Analysis of Personal Wealth 38

Analysis of Simulated Retirement Income 40

Appendix II Alternative Scenarios 52 

Retirement Income Under the No-Sunset Pension Scenario 52

Distributional Figures and Tables for the Baby Boom and for 

Generation X under Alternative Scenarios 54

Appendix III GAO Contacts and Staff Acknowledgments 75 

GAO Contacts 75

Staff Acknowledgments 75

Related GAO Products 76 

Tables 

Table 1: The Median Value of Net Worth for Households Headed by 

a 25- to 34-Year Old—Differences by Homeownership, 

Marital Status, and Education 21

Table 2: Median Value of Wealth-to-Income Ratios for Households 

Headed by a 25- to 34-Year Old—Differences by 

Homeownership, Marital Status, and Education 22

Contents 
Page ii GAO-03-429 Retirement Income 

Table 3: Median Monthly Household Retirement Income and Its 

Major Components, at Age 62, if Social Security Shortfall 

Addressed by Increasing Revenues 24

Table 4: Median Monthly Household Retirement Income and Its 

Major Components, at Age 62, if Social Security Shortfall 

Addressed by Reducing Benefits 24

Table 5: Median Monthly Household Retirement Income and Its 

Major Components, at Age 62, if Social Security Shortfall 

Addressed by Reducing Benefits and Generation X Having 

Only DC Pension Plans 26

Table 6: Median Household Replacement Rates for Baby Boom and 

Generation X 27

Table 7: Median Monthly Household Retirement Income at Age 62 

by Marital Status for Generation X, in 2001 Dollars 34

Table 8: Participation Rates by Age and Salary, 2001 45

Table 9: Contribution Rates by Age and Salary, 1999 45

Table 10: Average Asset Allocation Rates by Age and Investment 

Options, 2000 46

Table 11: Assets at Termination, 2000 46

Table 12: Median Monthly Household Retirement Income and its 

Major Components, at Age 62, if Social Security Shortfall 

Addressed by Increasing Revenues 52

Table 13: Median Monthly Household Retirement Income and its 

Major Components, at Age 62, if Social Security Shortfall 

addressed by Reducing Benefits 53

Table 14: Median Monthly Household Retirement Income and its 

Major Components, at Age 62, if Social Security Shortfall 

Addressed by Reducing Benefits and Generation X Having 

Only DC Pension Plans 53

Table 15: Median Household Replacement Rates for Baby Boom 

and Generation X 54

Table 16: Median Monthly Household Retirement Income at Age 62 

by Marital Status for the Baby Boom, in 2001 Dollars 59

Table 17: Median Monthly Household Retirement Income at Age 62 

by Marital Status for Generation X When All Pensions are 

DC Pensions, in 2001 Dollars 64

Table 18: Median Monthly Household Retirement Income at Age 62 

by Marital Status for Generation X with Extension of 

Raised Pension Contribution Limits, in 2001 Dollars 69

Table 19: Median Monthly Household Retirement Income at Age 62 

by Marital Status for Generation X with Scheduled Social 

Security Benefits, in 2001 Dollars 74
Page iii GAO-03-429 Retirement Income 

Figures 

Figure 1: Percentage of the Aged Receiving Income, by Source 6

Figure 2: Average Weekly Earnings for Production or 

Nonsupervisory Workers, Adjusted for Inflation 8

Figure 3: Labor Force Participation Rates of Married Women 9

Figure 4: Estimated Private Wage and Salary Worker Participation 

Rates Under DB and DC Pension Plans 10

Figure 5: Levels of Education Completed by Individuals Age 25 and 

Over 11

Figure 6: Percentage of Households by Household Composition 12

Figure 7: Median Value of Total Assets, Retirement Accounts, and 

Housing Assets, and the Percentage of Households with 

these Assets for Households Headed by a 25- to 34-YearOld 15

Figure 8: Median Value of Total Assets, Financial Assets, and 

Nonfinancial Assets, and the Percentage of Households 

with These Assets for Households Headed by a 25- to 34-

Year Old 17

Figure 9: Median Value of Debt and the Percentage of Households 

with Debt for Households Headed by a 25- to 34-Year Old 

(Total Debt, Housing Debt, Financial Debt, and Other 

Debt) 19

Figure 10: Median Value of Positive and Negative Net Worth and 

the Percentage of Households with Net Worth for 

Households Headed by a 25- to 34-Year Old 20

Figure 11: Proportion of Household Retirement Income for Each 

Quintile of the Retirement Income Distribution at Age 62 

for Generation X 29

Figure 12: Proportion of Household Pension Benefits and 

Household Social Security Benefits for Each Quintile of 

the Pension Benefit and Social Security Benefit 

Distributions at Age 62 for Generation X 30

Figure 13: Median Monthly Household Retirement Income at Age 

62 for Generation X by Pension Status 31

Figure 14: Median Monthly Household Retirement Income at Age 

62 by Educational Attainment for Generation X 33

Figure 15: Median Monthly Retirement Income at Age 62 by Gender 

for Single Person Households for Generation X 35
Page iv GAO-03-429 Retirement Income 

Figure 16: Proportion of Household Retirement Income for Each 

Quintile of the Retirement Income Distribution at Age 62 

for the Baby Boom 55

Figure 17: Proportion of Household Pension Benefits and 

Household Social Security Benefits for Each Quintile of 

the Pension Benefit and Social Security Benefit 

Distributions at Age 62 for the Baby Boom 56

Figure 18: Median Monthly Household Retirement Income at Age 

62 by Pension Status for the Baby Boom 57

Figure 19: Median Monthly Household Retirement Income at Age 

62 by Educational Attainment for the Baby Boom 58

Figure 20: Median Monthly Retirement Income at Age 62 by Gender 

for Single Person Households for the Baby Boom 59

Figure 21: Proportion of Household Retirement Income for Each 

Quintile of the Retirement Income Distribution at Age 62 

for Generation X When All Pensions Are DC Pensions 60

Figure 22: Proportion of Household Pension Benefits and 

Household Social Security Benefits for Each Quintile of 

the Pension Benefit and Social Security Benefit 

Distributions at Age 62 for Generation X When all 

Pensions are DC Pensions 61

Figure 23: Median Monthly Household Retirement Income at Age 

62 by Pension Status for Generation X When All Pensions 

Are DC Pensions 62

Figure 24: Median Monthly Household Retirement Income at Age 

62 by Educational Attainment for Generation X When All 

Pensions Are DC Pensions 63

Figure 25: Median Monthly Retirement Income at Age 62 by Gender 

for Single Person Households for Generation X When All 

Pensions are DC Pensions 64

Figure 26: Proportion of Household Retirement Income for Each 

Quintile of the Retirement Income Distribution at Age 62 

for Generation X with Extension of Raised Pension 

Contribution Limits 65

Figure 27: Proportion of Household Pension Benefits and 

Household Social Security Benefits for Each Quintile of 

the Pension Benefit and Social Security Benefit 

Distributions at Age 62 for Generation X with Extension 

of Raised Pension Contribution Limits 66

Figure 28: Median Monthly Household Retirement Income at Age 

62 by Pension Status for Generation X with Extension of 

Raised Pension Contribution Limits 67
Page v GAO-03-429 Retirement Income 

Figure 29: Median Monthly Household Retirement Income at Age 

62 by Educational Attainment for Generation X with 

Extension of Raised Pension Contribution Limits 68

Figure 30: Median Monthly Retirement Income at Age 62 by Gender 

for Single Person Households for Generation X with 

Extension of Raised Pension Contribution Limits 69

Figure 31: Proportion of Household Retirement Income for Each 

Quintile of the Retirement Income Distribution at Age 62 

for Generation X with Scheduled Social Security Benefits 70

Figure 32: Proportion of Household Pension Benefits and 

Household Social Security Benefits for Each Quintile of 

the Pension Benefit and Social Security Benefit 

Distributions at Age 62 for Generation X with Scheduled 

Social Security Benefits 71

Figure 33: Median Monthly Household Retirement Income at Age 

62 by Pension Status for Generation X with Scheduled 

Social Security Benefits 72

Figure 34: Median Monthly Household Retirement Income at Age 

62 by Educational Attainment for Generation X with 

Scheduled Social Security Benefits 73

Figure 35: Median Monthly Retirement Income at Age 62 by Gender 

for Generation X for Single Person Households with 

Scheduled Social Security Benefits 74
Page vi GAO-03-429 Retirement Income 

Abbreviations 

DB defined benefit 

DC defined contribution 

EGTRRA Economic Growth and Tax Relief Reconciliation Act of 

2001 

ERISA Employee Retirement Income Security Act of 1974 

GEMINI Genuine Microsimulation of Social Security and Accounts 

IRA individual retirement account 

OASDI Old Age, Survivor and Disability Insurance 

PENSIM Pension Simulator 

PIA primary insurance amount 

PSG Policy Simulation Group 

PSID Panel Study of Income Dynamics 

SCF Survey of Consumer Finances 

SIPP Survey of Income and Program Participation 

SSASIM Social Security and Accounts Simulator 

SSI Supplemental Security Income 

This is a work of the U.S. Government and is not subject to copyright protection in the 

United States. It may be reproduced and distributed in its entirety without further 

permission from GAO. It may contain copyrighted graphics, images or other materials. 

Permission from the copyright holder may be necessary should you wish to reproduce 

copyrighted materials separately from GAO’s product. 
Page 1 GAO-03-429 Retirement Income 

April 25, 2003 

The Honorable Robert Andrews 

Ranking Minority Member 

Subcommittee on Employer-Employee Relations 

Committee on Education and the Workforce 

House of Representatives 

Dear Mr. Andrews: 

Today’s workers will rely to a large extent on Social Security, private 

pensions, and personal wealth for their retirement income. But some 

analysts question whether these sources will provide sufficient retirement 

income to maintain workers’ standards of living once they leave the labor 

force.1

 Indeed, the Social Security trust funds are projected to become 

exhausted in 2042, at which time, unless action is taken, Social Security 

will not be able to pay scheduled benefits in full.2

 Pension coverage has 

remained at about 50 percent of the workforce for decades while the 

composition of that coverage has shifted from defined benefit (DB) plans 

to defined contribution (DC) plans.3

 As a result of this shift, an increasing 

share of the responsibility for providing for one’s retirement income has 

shifted from the employer to the employee. Finally, workers today are 

saving a smaller proportion of their incomes than earlier generations did. 

Yet, if current workers are to maintain their standards of living and meet 

increasing health care costs in retirement, they need to save more. 

 1

An early assessment of the sufficiency of retirement income for the Baby Boom was 

presented in a 1993 Congressional Budget Office study, Baby Boomers in Retirement: An 

Early Perspective.

2

The projection of trust fund exhaustion in 2042 is based on the intermediate assumptions 

of the Social Security Administration’s Office of the Chief Actuary as presented in the 2003 

Trustees Report. According to the same assumptions, annual costs will exceed tax income 

for the Social Security trust funds starting in 2018. 

3

In DB plans, the amount of the benefit received at retirement is defined in advance by the 

plan’s benefit formula, which considers such factors as salary and service. In a DC plan, it 

is the amount of the contribution made by the employer, employee, or both, to the worker’s 

individual account that is defined. Benefits in this type of plan are based largely on the 

amount contributed but are also affected by how this amount is invested. 

United States General Accounting Office

Washington, DC 20548 
Page 2 GAO-03-429 Retirement Income 

These trends suggest that today’s younger workers might reach retirement 

unable to maintain the standards of living they had achieved while 

working. Additionally, there may be a greater strain on retirement assets if 

younger workers spend more years in retirement due to greater life 

expectancy. To gain an understanding of what today’s workers might 

expect to receive in terms of retirement income, you asked us to examine 

(1) how the wealth of Baby Boom and Generation X workers compares 

with what current retirees (pre-Baby Boom generation) had as young 

adults, (2) how workers from the Baby Boom and Generation X compare 

in terms of the pension and Social Security benefits they can expect to 

receive, and (3) the likely distribution of pension benefits and Social 

Security benefits for all workers within the Baby Boom and Generation X. 

The Baby Boom generation includes those born between 1946 and 1964, 

Generation X includes those born between 1965 and 1976, and we define 

the Pre-Baby Boom generation as those born between 1925 and 1945. 

To compare wealth across all three generations, we used the Federal 

Reserve Board’s Survey of Consumer Finances (SCF), a nationally 

representative database containing detailed information on assets and 

debt, and compared the ownership and median levels of different types of 

assets and debt for 25- to 34-year olds in each generation. We selected this 

age group because it is important to compare each of the generations at 

the same life-cycle stage and this is the only age group for which we have 

data on wealth for all three generations.4

 This comparison enabled us to 

assess the extent to which the Baby Boom and Generation X have been 

able to accumulate wealth, some or all of which can be used to finance 

consumption in retirement. However, our wealth measure does not 

include the future values of Social Security or pensions.5

 Therefore, to 

complement our analysis of the younger generations’ wealth, we simulated 

future retirement income for the Baby Boom and Generation X. To 

illustrate the levels and distribution of retirement income that current 

workers can expect to receive at age 62, we used the Policy Simulation 

 4

Under the standard life-cycle theory of personal saving, people save and accumulate 

wealth to smooth their standard of living over their lifetime. Young adults entering the 

workforce tend to save less than older workers in their peak earning years. The elderly 

draw on their wealth in retirement. 

5

For individuals covered by pension plans, the SCF includes amounts accumulated under 

DC plans but does not capture the expected value of future benefits under DB plans. The 

SCF also does not capture the expected value of future Social Security benefits. 
Page 3 GAO-03-429 Retirement Income 

Group’s (PSG) models6 to simulate some components of retirement 

income—Social Security benefits, pension income, and the earnings of 

spouses not yet retired. Under contract to us, the PSG used Pension 

Simulator (PENSIM) to estimate pension benefits and Genuine 

Microsimulation of Social Security and Accounts (GEMINI) to estimate 

Social Security benefits for two illustrative birth cohorts—Baby Boomers 

born in 1955 and Generation Xers born in 1970. These simulations are 

based on the Social Security Trustees’ 2001 intermediate economic and 

actuarial assumptions. While our simulations provide estimates of future 

retirement income, there is a considerable amount of uncertainty involved 

with these estimates. Since these estimates could change significantly, 

depending on assumptions used and behavioral responses, they should not 

be considered predictions. 

In order to bound our estimates of retirement income, we considered 

different scenarios for Social Security and pensions. We used two 

scenarios for estimating Social Security benefits: (1) scheduled benefits 

are paid and (2) funded benefits are paid.7

 We also considered two 

scenarios for pension benefits, one assuming that both the Baby Boom and 

Generation X had the same DB and DC pension plan coverage and the 

other that Generation X workers with pensions had only DC pensions. We 

compared the two younger generations under these various scenarios 

because the retirement income of these younger generations will be 

affected by policy decisions on Social Security and pensions. Changes in 

Social Security and pension benefits, in turn, will affect the amount that 

the Baby Boom and Generation X need to save. 

We conducted our work between April 2002 and April 2003 in accordance 

with generally accepted government auditing standards. A more detailed 

discussion of our scope and methodology appears in appendix I. 

Baby Boom and Generation X households headed by individuals aged 25 to 

34 have greater accumulated assets, adjusted for inflation, than current 

 6

The models—Social Security and Accounts Simulator, Genuine Microsimulation of Social 

Security and Accounts, and Pension Simulator—are described in appendix I. 

7

While there are many ways of achieving the same result, we chose to focus on the polar 

cases or bounds for change within the current system. For additional information on the 

benchmarks, see U.S. General Accounting Office, Social Security: Program’s Role in 

Helping Ensure Income Adequacy, GAO-02-62 (Washington, D.C.: Nov. 30, 2001) and 

appendix I. 

Results in Brief 
Page 4 GAO-03-429 Retirement Income 

retirees had when they were the same age, but also more debt. Most of the 

large increase in assets between current retirees and the Baby Boom is 

due to increased ownership and equity in housing. Contributions to DC 

pension plans play a role in explaining the modest increase in assets 

between the Baby Boom and Generation X, in part because SCF data do 

not reflect the value of future benefits from DB pension plans. Of the three 

groups, members of Generation X carry the most debt. Yet, for Baby Boom 

and Generation X households with positive net worth (assets exceed debt) 

at age 25 to 34, net worth is 60 percent greater than that of current retirees 

when they were the same age. However, particularly for Generation X, 

greater life expectancy may require more assets to cover more years in 

retirement and greater assets may also be required to support higher 

standards of living. Additionally, within each generation, some people will 

not do as well as others. Specifically, those who do not own their home, 

are less educated, or are single, have less net worth. 

Our simulations suggest that Generation X workers will have similar levels 

of retirement income in real terms (adjusted for inflation) at age 62 as 

their counterparts in the Baby Boom generation, but Generation X may be 

able to replace a smaller percentage of their preretirement income. 

Whether Social Security benefits for Generation X are higher or lower than 

those for the Baby Boom generation will depend on how the Social 

Security funding shortfall is resolved. If scheduled benefits were 

maintained by increasing program revenues, then Generation X could 

receive higher Social Security benefits in constant dollars than the Baby 

Boom generation, but at the possible cost of higher taxes and a reduced 

capacity to save during their working lives. If benefits were reduced to 

levels payable by current payroll tax rates, then Generation X could 

receive somewhat lower Social Security benefits than the Baby Boom 

generation. With regard to pensions, Generation X and the Baby Boomers 

are estimated to have similar levels of retirement income. A continued 

shift from DB to DC pension coverage does not appear to have much 

effect on the relative pension income of Generation X and the Baby Boom. 

With respect to replacement rates, however, Generation X is estimated to 

be able to replace a smaller percentage of preretirement income than the 

Baby Boom. The lower replacement rates for Generation X might translate 

into a decline in their standard of living at retirement, absent increases in 

retirement income related to behavioral changes (e.g., increases in 

savings, working longer), or external factors (e.g., increases in rates of 

return on assets). 

Retirement income will vary within both Generation X and the Baby Boom 

generation and certain groups will be more likely to have lower retirement 
Page 5 GAO-03-429 Retirement Income 

incomes. As one might expect, given significant variation in workers’ 

earnings, if households were arrayed from lowest to highest in terms of 

estimated retirement income, those in the top 20 percent would receive a 

substantially larger proportion of income compared with those in the 

bottom 20 percent. Retirement income is lower for the less educated and 

for single women. 

Retirement income in the United States includes Social Security benefits, 

asset income, pension benefits, and earnings. Over the last 40 years, 

receipt of Social Security has become almost universal while receipt of 

asset income has increased modestly, receipt of private pensions has 

tripled, and receipt of government pensions has increased by 50 percent. 

However, a smaller proportion of aged households received earnings in 

2000 than in 1962. (See fig. 1.) All of these components of retirement 

income have been affected by the major regulatory, labor market, and 

demographic changes that have taken place in the last 40 years. 

Background 
Page 6 GAO-03-429 Retirement Income 

Figure 1: Percentage of the Aged Receiving Income, by Source 

Note: The aged include couples and nonmarried persons age 65 or older. 

Legislative changes have expanded the pension and personal saving 

options available to workers.8

 The Employee Retirement Income Security 

Act (ERISA) of 1974 provided certain minimum standards and broad new 

protections of employee benefits plans, including provisions for individual 

retirement accounts (IRA). Subsequent legislation revised some provisions 

of ERISA, further expanding the possibilities for workers to have access to 

pension income in retirement and established new types of employersponsored pension plans, such as 401(k) plans. 

Legislative changes have also focused on the financing problems of Social 

Security. In the late 1970s and early 1980s, legislative action regarding 

 8

We have issued several reports on pension coverage and participation: U.S. General 

Accounting Office, Private Pensions: Improving Worker Coverage and Benefits, 

GAO-02-225 (Washington, D.C.: Apr. 9, 2002); Private Pensions: Issues of Coverage and 

Increasing Contribution Limits for Defined Contribution Plans, GAO-01-846

(Washington, D.C.: Sept. 17, 2001); Pension Plans: Characteristics of Persons in the Labor 

Force Without Pension Coverage, GAO/HEHS-00-131 (Washington, D.C.: Aug. 22, 2000). 

0 20 40 60 80 100

Earnings

Government Pensions

Private Pensions

Asset Income

Social Security

Percentage of aged

2000

1962

Source: Fast Facts and Figures About Social Security, Social Security Administration, 2002.

Source

69

90

54

59

9

29

9

14

36

22
Page 7 GAO-03-429 Retirement Income 

Social Security attempted to solve this financing problem by raising taxes, 

curtailing future benefits, raising the retirement age, and trying to increase 

work incentives. However, the financing of future Social Security benefits 

is still an issue, and further action will need to be taken to either increase 

the program’s revenues, decrease its expenditures, or both. 

The labor market conditions facing young workers today differ 

significantly from those facing earlier generations of workers. Changes in 

earnings, women’s labor force participation, and pension coverage over 

the last 40 years have altered the context within which workers save for 

retirement. Real earnings increased throughout the 1960s, slowed 

considerably in the 1970s, remained relatively stagnant during the 1980s 

and much of the 1990s, and may have started to rise in the late 1990s. For 

some groups of workers, such as production or nonsupervisory workers, 

average weekly earnings adjusted for inflation declined over most of the 

time period following the early 1970s. (See fig. 2.) For young workers 

facing stagnant or declining real earnings, saving for retirement might have 

become more difficult than it was for those who entered the labor market 

when real earnings were growing. 
Page 8 GAO-03-429 Retirement Income 

Figure 2: Average Weekly Earnings for Production or Nonsupervisory Workers, Adjusted for Inflation 

In addition, over the last 40 years, more women have entered the labor 

force. They entered regardless of their marital status—the labor force 

participation rates of married women, for example, increased from 

32 percent in 1960 to 61 percent in 1999. (See fig. 3.) This means a larger 

share of women in younger cohorts is working and likely to qualify for 

Social Security and pensions based on their own earnings. This also means 

an increase in the share of married couple households that have two 

earners, which could increase the potential for household retirement 

saving. 

Average weekly earnings in 1998 dollars

Source: Department of Labor, Bureau of Labor Statistics.

200

250

300

350

400

450

500

550

1960 1962 1964 1966 1968 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998
Page 9 GAO-03-429 Retirement Income 

Figure 3: Labor Force Participation Rates of Married Women 

The composition of pension coverage also changed during this period. The 

estimated share of private wage and salary workers participating in a DB 

plan as their primary pension plan declined from 39 percent in 1975 to 

21 percent in 1997, while the share participating in a DC plan as their 

primary pension plan increased from 6 percent to 25 percent. (See fig. 4.) 

The decline in DB pension plan coverage and the increase in DC pension 

plan coverage over the past 3 decades means that more of the 

responsibility for retirement saving has shifted to individual workers from 

employers. 

Percentage

0

10

20

30

40

50

60

70

1960 1980 1999

Source: Bureau of the Census.
Page 10 GAO-03-429 Retirement Income 

Figure 4: Estimated Private Wage and Salary Worker Participation Rates Under DB 

and DC Pension Plans 

Demographic changes over the last 40 years have also altered the 

circumstances of workers as they save for retirement. Educational 

attainment, for example, has increased over time. In 1960, only about 

8 percent of the population 25 years of age and older had a college degree. 

By 1999, 25 percent of the population 25 years or older were college 

graduates. (See fig. 5.) The increase in educational attainment over time 

could facilitate increased saving among those younger workers who attain 

higher education. The composition of households has also changed over 

this period with the share of households headed by a married couple 

decreasing. In 1960, 74 percent of all households were comprised of 

married couple families. By 1999 this had fallen to 53 percent. At the same 

time, the percentage of one-person households increased from 13 percent 

to 26 percent of all households. (See fig. 6.) Median incomes are typically 

lower for families headed by a single female or for single person 

households. In addition, life expectancy has increased across the 

Percentage of workers participating

0

10

20

30

40

50

1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997

Source: Department of Labor, Employee Benefits Security Administration (formerly the Pension and Welfare Benefits Administration).

DB

DC-Supplemental

DC-Primary
Page 11 GAO-03-429 Retirement Income 

generations.9 The greater life expectancy of the younger generations could 

mean that the retirement income of the Baby Boom and Generation X 

would need to support a larger number of years. 

Figure 5: Levels of Education Completed by Individuals Age 25 and Over 

 9

The life expectancy for a person born in 1940 (Pre-Baby Boom) is 61.4 years for a male and 

65.7 years for a female. However, a person born in 1955 (Baby Boom) has a life expectancy 

of 66.7 years if male and 72.8 years if female. And someone born in 1970, and therefore a 

member of Generation X, has a life expectancy of 67.2 years if male and 74.9 years if 

female. 

Percentage of population

0

10

20

30

40

50

60

70

1960 1980 1999 Y

Less than H.S.

H.S. or some college

College degree or more

Source: Bureau of the Census.
Page 12 GAO-03-429 Retirement Income 

Figure 6: Percentage of Households by Household Composition 

The retirement security of today’s workers will also be affected by 

changes in the cost and provision of health care. Over the last 40 years, the 

provision of health benefits has become more expensive for employers as 

generous benefits have combined with higher utilization rates, a growing 

elderly population, and a rapidly increasing cost of service. In response to 

these increased costs, many employers have begun to limit the health 

benefits provided, either by terminating their plans, restricting benefits, or 

reducing their share of the premium. As a result, future retirees are likely 

to pay more of the costs of their health care. Consequently, today’s 

workers might have to work longer, save more, or both, to ensure 

sufficient access to health benefits. In addition to paying more for 

privately sponsored health benefits, today’s current workers might also 

pay more in retirement for Medicare. Medicare costs are continuing to rise 

with the result that either benefits will have to be reduced or monthly 

premiums will have to be increased. 

Given all these demographic changes, as well as regulatory and economic 

changes, analysis of retirement income is increasingly dependent on good 

estimates, which in turn require adequate data. In a recent report on 

Percentage of households

0

10

20

30

40

50

60

70

80

1960 1980 1999 X

Married couple

Female householder

One-person household

Source: Bureau of the Census.
Page 13 GAO-03-429 Retirement Income 

needed improvements in retirement income data, we identified data 

improvements that experts say are a priority for the study of retirement 

income.10 In particular, experts cited data from employers on employee 

benefits, as well as linkages between individual and household surveys 

and administrative data, as being helpful for estimating future retirement 

income. 

Baby Boom and Generation X households headed by individuals aged 25 to 

34 have greater accumulated assets, adjusted for inflation, than current 

retirees had when they were the same age but they also have more debt. 

The large increase in assets between current retirees—the Pre-Baby Boom 

generation—and the Baby Boom is due mainly to increases in home equity 

and increases in the rate of home ownership. The modest increase in 

assets between the Baby Boom and Generation X can be accounted for in 

large part by the increase in the ownership and value of DC retirement 

accounts, because SCF data do not reflect the value of benefits from DB 

pension plans.11 While the percentage of households with debt has changed 

very little across the generations, the real total debt levels have more than 

doubled between current retirees and Generation X workers. Yet, for most 

young Baby Boom and Generation X households, assets exceed debts and 

the net worth of these households with positive net worth is 60 percent 

greater than that of current retirees at similar ages. However, particularly 

for Generation X, greater life expectancy may require more assets to cover 

more years in retirement and greater assets may also be required to 

support higher standards of living. Within each generation, the distribution 

of net worth across households is affected by economic and demographic 

characteristics. Specifically, those who do not own their own home, are 

less educated, or are single, have less in net worth. 

 10U.S. General Accounting Office, Retirement Income Data: Improvements Could Better 

Support Analysis of Future Retirees’ Prospects, GAO-03-337 (Washington, D.C.: Mar. 21, 

2003). 

11Coverage by DB pension plans is greater for current retirees than for the Baby Boom or 

Generation X. Therefore, our measure of wealth underestimates their wealth relative to the 

wealth of the younger generations. To the extent that a larger percentage of the Baby Boom 

than Generation X is covered by DB plans, our measure of wealth also underestimates 

wealth for the Baby Boom relative to Generation X. 

Baby Boom and 

Generation X Workers 

Have More Assets and 

More Debt Than 

Current Retirees Had 

at Similar Ages 
Page 14 GAO-03-429 Retirement Income 

For households headed by a 25- to 34-year old, both the median value of 

total assets (in 1998 dollars) and the percentage of households with assets 

increased across the generations.12 (See fig. 7.) The median value of total 

assets for the Baby Boom and Generation X is more than 50 percent 

greater than that for the Pre-Baby Boom generation.13 While our analysis 

indicates that asset levels increase across the generations, it does not take 

into account the expectation of rising standards of living.14 Generation X, 

for example, could have greater assets than those of previous generations 

and still feel that these assets are insufficient for the lifestyle they want or 

expect. 

For households headed by a 25- to 34-year old, the increase in assets 

across the generations can be attributed mainly to housing and DC 

retirement accounts. (See fig. 7.) As we have noted, our measure of assets 

does not include the value of benefits from DB pension plans and, to the 

extent that a larger percentage of the Pre-Baby Boom and the Baby Boom 

than Generation X is covered by DB plans, will underestimate the true 

value of assets for the Pre-Baby Boom and the Baby Boom relative to 

Generation X. The large increase in total asset accumulation between the 

Pre-Baby Boom and the Baby Boom is largely due to increases in home 

equity and increases in the rate of home ownership. The median value of 

housing assets increased from $72,890 for the Pre-Baby Boom to $78,583 

for the Baby Boom, while the percentage of households owning their own 

home increased from 39 to 45 percent. The modest increase in total asset 

accumulation between the Baby Boom and Generation X can be 

accounted for in large part by the increase in the ownership and value of 

retirement accounts. The median value of DC retirement accounts 

increased from $2,947 for the Baby Boom to $8,003 for Generation X, while 

the percentage of households with retirement accounts increased from 

 12We define total assets to include assets that are specifically dedicated to retirement, such 

as IRAs, 401(k)s, 403(b)s, and other thrift-type plans, as well as assets that are not 

specifically dedicated to retirement but may ultimately provide retirement income, such as 

housing, financial assets (including savings accounts, mutual funds, stocks, and bonds), 

and nonfinancial assets (including vehicles, business interests, and nonresidential real 

estate). 

13Median values of assets are calculated only for those households that have assets. 

14Comparisons across the 3 years selected, 1962, 1983, and 1998, need to be qualified 

because these years do not represent similar points in the business cycle. 1962 and 1998 

were at the early and late stages, respectively, of an economic expansion, while 1983 was at 

the very end of a recession. To the extent that the position in the business cycle affects the 

real value of assets and debts, the comparison across generations may be misleading. 

Increases in Home Equity 

and Ownership are 

Responsible for Most of 

the Increase in Assets 

Across the Generations 
Page 15 GAO-03-429 Retirement Income 

20 percent to 46 percent. The increased percentage of households with 

retirement accounts reflects changes in the types of pension plans offered 

by employers. Between 1983 and 1997, the percentage of workers covered 

by primary DC pension plans, under which the worker has a retirement 

account, increased from 11 percent to 25 percent while the percentage of 

workers covered by DB pension plans declined from 35 percent to 21 

percent. 

Figure 7: Median Value of Total Assets, Retirement Accounts, and Housing Assets, 

and the Percentage of Households with these Assets for Households Headed by a 

25- to 34-Year-Old 

Note: GAO analysis based on data from the Survey of Consumer Finances. The median for housing 

assets is larger than the median for total assets because these medians come from two different 

distributions. Total assets include bank accounts and automobiles as well as housing, so the 

distribution of the value of total assets ranges from assets with relatively low values, such as bank 

accounts and other financial assets, to assets with relatively high values, such as houses. The 

distribution for housing assets includes only those households owning a home, whereas the 

distribution for total assets includes all households with any type of asset, including those who do not 

own homes. 

0

10

20

30

40

50

60

70

80

90

1998

Generation X

1983

Baby Boom

1962

Pre-Baby Boom

Median value in 1998 dollars (in thousands)

Total assets

Retirement accounts

Housing assets

Source: Federal Reserve Board.

Percentage of 

households 92.3 3.1 39.2 94.5 20.2 45.1 95.1 45.7 45.7
Page 16 GAO-03-429 Retirement Income 

Financial and nonfinancial assets contribute only modestly to the increase 

in total assets across the generations. (See fig. 8.) Financial assets include 

savings accounts, mutual funds, and stocks and bonds while nonfinancial 

assets include vehicles, business interests, and nonresidential real estate. 

The median value of financial assets varies between less than $2,000 for 

the Pre-Baby Boom generation and $4,000 for the Baby Boom. A greater 

percentage of households in the younger cohorts have financial assets 

than was the case for current retirees. The median value of nonfinancial 

assets is greater than that for financial assets in each of the generations 

and has increased across the cohorts. While the ownership of nonfinancial 

assets increased for the Baby Boom, relative to current retirees, it 

decreased for Generation X relative to both the Baby Boom and current 

retirees. 
Page 17 GAO-03-429 Retirement Income 

Figure 8: Median Value of Total Assets, Financial Assets, and Nonfinancial Assets, 

and the Percentage of Households with These Assets for Households Headed by a 

25- to 34-Year Old 

Note: GAO analysis based on data from the Survey of Consumer Finances. 

The degree to which the younger cohorts will be able to add to the assets 

that we observe when they are ages 25 to 34 will be affected by a number 

of demographic and economic factors. Individuals have control over some 

of these factors. For example, they can determine how much education 

they receive, how long they work, whether both spouses in a couple work, 

how much they save while they are working, and whether they stay 

married or get divorced. On the other hand, individuals have no direct 

control over the rate of growth of real wages, the performance of the 

overall economy, the rate of return on financial assets, changes in housing 

prices, shifts in pension coverage and generosity of benefits, the state of 

the health care system, changes in life expectancy, and the resolution to 

the funding shortfall for Social Security and Medicare. One of the 

resolutions to the funding shortfall for both Social Security and Medicare 

is to increase the payroll tax that employees and employers pay. An 

0

10

20

30

40

50

1998

Generation X

1983

Baby Boom

1962

Pre-Baby Boom

Median value in 1998 dollars (in thousands)

Total assets

Financial assets

Nonfinancial assets

Source: Federal Reserve Board.

Percentage of 

households 92.3 77.5 87.8 94.5 87.8 89.1 95.1 88.2 82.5
Page 18 GAO-03-429 Retirement Income 

increase in the payroll tax, of course, reduces the amount of an 

individual’s disposable income available to both consume and save. On the 

other hand, if individuals expected Social Security benefits to be reduced, 

they might increase their personal saving in order to offset this reduction 

in benefits. Likewise, increases in life expectancy may also require 

increased saving in order to provide for a greater number of years in 

retirement or might induce people to work longer. 

For households headed by a 25- to 34-year old, overall debt levels increase 

across the generations. (See fig. 9.) The median level of debt for the Baby 

Boom is 38 percent greater than that for the Pre-Baby Boom generation 

while Generation X’s median level of debt is 146 percent greater than that 

of the Pre-Baby Boom generation and 78 percent greater than that of the 

Baby Boom. The percentage of households with debt changed very little, 

however, remaining at roughly 83-84 percent across the generations. Thus, 

those households that go into debt are going into debt more deeply with 

each new generation. 

The increase in debt levels between the Baby Boom and Generation X was 

due largely to increases in housing debt.15 The median value of housing 

debt increased between the Baby Boom and Generation X by 61 percent. 

The percentage of households with housing debt changed very little 

between these two generations, however, remaining at roughly 40 percent. 

 15Median values of debt are calculated only for those households that have debt. 

The Younger Generations, 

Especially Generation X, 

Have Higher Levels of 

Debt Than Current 

Retirees Did at Similar 

Ages 
Page 19 GAO-03-429 Retirement Income 

Figure 9: Median Value of Debt and the Percentage of Households with Debt for 

Households Headed by a 25- to 34-Year Old (Total Debt, Housing Debt, Financial 

Debt, and Other Debt) 

Note: GAO analysis based on data from the Survey of Consumer Finances. The median for housing 

debt is larger than the median for total debt because these medians come from two different 

distributions. Total debt includes credit card and installment debt as well as housing debt. Because 

the distribution of the value of total debt includes relatively low levels of nonhousing debt as well as 

the higher levels of housing debt, the median will be lower than the median for housing debt. 

Nonhousing debt includes debt for other residential property, such as vacation homes, debt for 

nonresidential real estate, business debt, credit card debt, and installment loans. Other debt includes 

loans against pensions, loans against life insurance, and margin loans. 

The amount of debt carried by a household will affect the value of its net 

worth. For households headed by a 25- to 34-year old, the percentage of 

households with positive net worth and the median value of positive net 

worth increased between the Pre-Baby Boom and Generation X; however, 

the median value of negative net worth is also much higher for Generation 

X. (See fig. 10.) The median value of net worth for households with 

positive net worth increased by 60 percent between the Pre-Baby Boom 

0

10

20

30

40

50

60

70

80

1998

Generation X

1983

Baby Boom

1962

Pre-Baby Boom

Median value in 1998 dollars (in thousands)

Total debt

Housing debt

Other debt

Nonhousing debt

Source: Federal Reserve Board.

Percentage of 

households 84.5 36.9 3.2 80.8 82.5 40.5 14.8 72.3 83.6 39.5 10.7 76.9
Page 20 GAO-03-429 Retirement Income 

and the two younger generations. The percentage of households with 

negative net worth is smaller for the two younger generations than for 

current retirees when they were young. However, the median value of net 

worth for households with negative net worth is about four times larger 

for Generation X than for the Baby Boom or the Pre-Baby Boom. 

Figure 10: Median Value of Positive and Negative Net Worth and the Percentage of 

Households with Net Worth for Households Headed by a 25- to 34-Year Old 

Note: GAO analysis based on data from the Survey of Consumer Finances. Net worth is defined as 

assets minus debt. If assets are greater than debt, the household has positive net worth. If debt is 

greater than assets, the household has negative net worth. Therefore, the positive and negative net 

worth columns will not sum to total net worth since they are based on different distributions. 

-10

-5

0

5

10

15

20

25

30

1998 X

Generation X

1983

Baby Boom

1962

Pre-Baby Boom

Median value in 1998 dollars (in thousands)

Positive

Negative

Source: Federal Reserve Board.

Percentage of 

households 72.9 26.6 87.8 12.2 78.2 21.7
Page 21 GAO-03-429 Retirement Income 

The younger generations in general have experienced an increase in net 

worth relative to current retirees at the same age, with the Baby Boom 

having a median net worth three times that of the older generation and 

Generation X having a median net worth two and a half times that of 

current retirees. However, there are some groups within these cohorts that 

have not benefited as much as others. (See table 1.) For example, the 

median net worth for Baby Boom and Generation X homeowners is 

between $17,000 and $35,000 greater than that for Pre-Baby Boom 

homeowners; for nonhomeowners, net worth between the older and 

younger cohorts differs by only $2,300 to $3,700. Median net worth has 

increased across the cohorts for all education levels, but much less so for 

those without a high school degree. Both single headed households and 

households headed by a married couple have seen increases in net worth; 

however, the increases have been much smaller for single headed 

households. These trends have increased the disparity in net worth within 

the younger generations compared to the Pre-Baby Boom. 

Table 1: The Median Value of Net Worth for Households Headed by a 25- to 34-Year 

Old—Differences by Homeownership, Marital Status, and Education 

In 1998 dollars 

Median 

Pre-Baby Boom 

(1962)

Baby Boom 

(1983) 

Generation X 

(1998) 

Homeowners $25,594 $60,521 $43,100 

Nonhomeowners 982 4,699 3,300 

Less than high school 815 4,658 2,500 

High school graduate 10,044 17,195 17,920 

College graduate 23,953 36,569 30,020 

Married 9,165 31,677 34,501 

Not married 0 7,160 5,750 

All households $6,072 $19,504 $15,500 

Source: GAO analysis based on data from the Survey of Consumer Finances. 

Another measure of the well-being of different generations is the ratio of 

net worth, or wealth, to income. Median ratios of wealth to income for 

households headed by a 25- to 34-year old are presented in table 2. The 

Baby Boom and Generation X have higher wealth-to-income ratios than 

current retirees had at similar ages. This suggests that households in the 

younger generations have been able to accumulate more wealth than was 

the case for current retirees. The ratios also reflect the differences across 

demographic groups within generations. Within each generation, ratios of 

Within Each Generation, 

the Value of Net Worth Is 

Lower for Those Who Do 

Not Own Their Own Home, 

Are Less Educated, or Are 

Single 
Page 22 GAO-03-429 Retirement Income 

wealth to income are higher for the well-educated, the married, and 

homeowners. 

Table 2: Median Value of Wealth-to-Income Ratios for Households Headed by a 

25- to 34-Year Old—Differences by Homeownership, Marital Status, and Education 

 Median 

Pre-Baby Boom 

(1962) 

Baby Boom 

(1983)

Generation X 

(1998)

Homeowner 0.641 1.343 1.044

Nonhomeowners 0.052 0.167 0.151

Less than high school 0.029 0.216 0.159

High school graduate 0.278 0.525 0.586

College graduate 0.510 0.799 0.743

Married 0.261 0.755 0.742

Not married 0.000 0.299 0.268

All households 0.214 0.562 0.523

Source: Federal Reserve Board. 

Note: GAO analysis based on data from the Survey of Consumer Finances. 

In our simulations, Generation X and the Baby Boom16 have similar levels 

of retirement income in real terms (adjusted for inflation). Social Security 

benefit levels for Generation X and the Baby Boom will depend on how the 

Social Security funding shortfall is resolved. The shift to greater DC 

pension coverage does not have much effect on the pension income of 

Generation X relative to the Baby Boom. However, replacement rates for 

Generation X are estimated to be lower than for the Baby Boom under 

each scenario we considered, suggesting retirement income for 

Generation X may not keep up with the rising standard of living, absent 

increases in other sources of retirement income, or increases in rates of 

return. 

 16For our analyses, we considered two illustrative birth cohorts—Baby Boomers born in 

1955 and Generation Xers born in 1970. 

Generation X and the 

Baby Boom Are 

Estimated to Have 

Similar Levels of Real 

Retirement Income, 

but Generation X 

Could Have Lower 

Replacement Rates 
Page 23 GAO-03-429 Retirement Income 

Our simulations suggest that Generation X will have real retirement 

income17 that is similar or somewhat higher than the Baby Boom, 

depending on how the Social Security funding shortfall is resolved.18 If the 

shortfall is resolved by increasing the program’s revenues19 to maintain 

scheduled benefits, then Generation X is estimated to have somewhat 

higher real retirement income at age 62 than the Baby Boom generation. 

(See table 3.) Because our simulations assume that real earnings increase 

over time,20 Generation X would have higher Social Security benefits than 

the Baby Boom. However, if the shortfall is resolved through gradual 

benefit reductions over time,21 then Generation X is estimated to have real 

retirement income levels at age 62 that are more similar to those of the 

Baby Boom. (See table 4.) Because the benefit reductions increase over 

time, they would have more impact on Generation X than on the Baby 

Boom, leading to slightly lower Social Security benefits for Generation X 

relative to the Baby Boom. 

 17Due to the current state of the simulation models used, the measure of retirement income 

used here includes Social Security benefits, private pension income, and spouse’s earnings. 

Private pensions include both DB and DC plans. See appendix I for a description of the DB 

and DC plans modeled. 

18While there are many ways of achieving the same result, we chose to focus on the polar 

cases or bounds for change within the current system. For additional information on the 

benchmarks, see U.S. General Accounting Office, Social Security: Program’s Role in 

Helping Ensure Income Adequacy, GAO-02-62 (Washington, D.C.: Nov. 30, 2001) and 

appendix I. 

19There would be no change in benefits, but additional revenue would enter the system 

through increased taxes, general revenue transfers, or some similar means. 

20Our simulations are based on the intermediate assumptions in the 2001 Social Security 

Trustees Report. 

21There would be no change in the amount of revenue entering the system, instead, initial 

Social Security benefits would be reduced each year in order to make the system solvent 

over the 75-year projection period. 

Cross-generational 

Comparisons of 

Retirement Income Levels 

Will Be Affected by the 

Resolution to the Social 

Security Funding Shortfall 
Page 24 GAO-03-429 Retirement Income 

Table 3: Median Monthly Household Retirement Income and Its Major Components, 

at Age 62, if Social Security Shortfall Addressed by Increasing Revenues 

 Baby Boom Generation X 

Retirement income $3,147 $3,365 

Pension income (DB and DC) $962 $942 

Social Security benefits $1,366 $1,549 

Source: GEMINI/PENSIM. 

Note: Median values at age 62 discounted to 2001 dollars and DC account balances annuitized at 

retirement. Not all components of retirement income are shown. Pension income is measured across 

all individuals in the cohort. Median pension income for those covered by a pension is $1,495 for the 

Baby Boom and $1,440 for Generation X. In our simulations, the rates of return for DC pension 

contributions vary over time and by individual. Median spousal earnings for those spouses working 

are $3,295 for the Baby Boom and $3,375 for Generation X. 

Changes to the Social Security system could also affect other forms of 

retirement income, especially those not considered here. If program 

revenues were increased by raising Social Security payroll taxes, then 

individuals would have less disposable income to save for retirement. This 

could take the form of decreases in personal saving or lower contributions 

to DC pension plans. Instead, if general revenues were used, the funding of 

other programs could be affected, which could lower some individuals’ 

income from other income support programs, such as Supplemental 

Security Income (SSI). The timing and implementation of the changes to 

the Social Security system are also relevant since action taken later rather 

than sooner would necessitate larger tax increases or benefit reductions 

and the impact on Generation X could be even greater. 

Table 4: Median Monthly Household Retirement Income and Its Major Components, 

at Age 62, if Social Security Shortfall Addressed by Reducing Benefits 

 Baby Boom Generation X 

Retirement income $3,011 $2,991 

Pension income (DB and DC) $962 $942 

Social Security benefits $1,234 $1,199 

Source: GEMINI/PENSIM. 

Note: Median values at age 62 discounted to 2001 dollars and DC account balances annuitized at 

retirement. Not all components of retirement income are shown. Pension income is measured across 

all individuals in the cohort. Median pension income for those covered by a pension is $1,495 for the 

Baby Boom and $1,440 for Generation X. In our simulations, the rates of return for DC pension 

contributions vary over time and by individual. Median spousal earnings for those spouses working 

are $3,295 for the Baby Boom and $3,375 for Generation X. 
Page 25 GAO-03-429 Retirement Income 

Generation X and the Baby Boom are estimated to have similar levels of 

pension income when our simulations assume that the rate of DB and DC 

pension coverage is constant over time.22 (See table 4.) DC account 

balances are annuitized at retirement to facilitate comparisons. While 

Generation X’s simulated higher earnings might have suggested higher 

pension income as well, they may have been too young to completely 

benefit from the strong stock market of the 1990s.The assumption that the 

rate of pension coverage is constant over time has not been the experience 

of private pensions in the United States over the last 25 years. DB coverage 

has declined, and DC coverage has increased. 

Generation X and the Baby Boom are estimated to have similar levels of 

pension income even when our simulations assume Generation X only has 

access to DC pension plans.23 (See table 5.) While assuming that all 

pension coverage will shift to DC plans represents the extreme case, it 

does provide a bound to our estimates. These simulations provide some 

insight into the impact that the continuing shift from DB to DC pension 

coverage might have on retirement income for Generation X, since the 

final outcome of this shift is uncertain. 

 22The Economic Growth and Tax Relief Reconciliation Act of 2001 increased the limits on 

contributions to DC pension plans and the maximum DB pension. The act also contained a 

sunset provision, which will return these limits to their pre-act levels in 2010. Legislation 

has been proposed that would eliminate the sunset provision in the act. Since no action has 

been taken on this legislation, we present our findings under the sunset scenario. Our 

simulations of a no-sunset scenario appear in appendix II. 

23This result may depend on the rates of return. In our analyses, the mean nominal rates of 

return, which all returns varied around, were 6.3 percent for Treasuries, 6.8 percent for 

corporate bonds, and 10 percent for equities. See the limitations of analysis in appendix I. 

Generation X and the Baby 

Boom May Have Similar 

Levels of Pension Income 

Even When Pension 

Coverage Shifts from DB 

to DC Plans 
Page 26 GAO-03-429 Retirement Income 

Table 5: Median Monthly Household Retirement Income and Its Major Components, 

at Age 62, if Social Security Shortfall Addressed by Reducing Benefits and 

Generation X Having Only DC Pension Plans 

 Baby Boom Generation X 

Retirement income $3,011 $3,096 

Pension income (DB and DC) $962 $984 

Social Security benefits $1,234 $1,199 

Source: GEMINI/PENSIM. 

Note: Median values at age 62 discounted to 2001 dollars and DC account balances annuitized at 

retirement. Not all components of retirement income are shown. Pension income is measured across 

all individuals in the cohort. Median pension income for those covered by a pension is $1,495 for the 

Baby Boom and $1,700 for Generation X. In our simulations, the rates of return for DC pension 

contributions vary over time and by individual. Median spousal earnings for those spouses working 

are $3,295 for the Baby Boom and $3,375 for Generation X. 

In our simulations, Generation X has a lower earnings replacement rate24

than the Baby Boom (see table 6) even though the Baby Boom and 

Generation X are estimated to have similar levels of retirement income. 

Our assumption of increasing earnings over time leads to Generation X 

having a lower replacement rate. The largest difference between the 

cohorts, in terms of replacement rates, occurs under the Social Security 

benefit reduction scenario since benefit levels are falling more for 

Generation X while earnings are unchanged. While the shift in pension 

coverage raises the level of retirement income for Generation X, it does 

not change the replacement rate.25

The earnings replacement rate is an indicator of how well individuals are 

doing at maintaining their pre-retirement standard of living. While our 

estimated replacement rates do not cover all individuals in each 

generation or include all forms of retirement income, they still might 

indicate a decline in the standard of living during retirement for 

Generation X. However, this does not take into account that retirement 

income may increase because of behavioral changes or other external 

 24Our earnings replacement rate is calculated as retirement income at age 62 divided by 

earnings at age 61. Given the complexity of trying to calculate replacement rates at the 

household level when spouses are not the same age and beneficiaries become entitled at 

different ages, we calculated replacement rates at age 62 only for retired workers who had 

worked at age 61 and whose spouses, if married, were the same age. 

25Our shift to all DC coverage assumed that some individuals who were previously covered 

by a DB plan would choose not to contribute to a DC plan. This decrease in pension 

coverage may offset the increase in pension income, leaving the median replacement rate 

unchanged. 

Replacement Rates Lower 

for Generation X Relative 

to the Baby Boom 
Page 27 GAO-03-429 Retirement Income 

factors. Since Generation X is still relatively young, it is possible that some 

members of this cohort may change their behavior and save more or work 

longer.26 Also, variations in rates of return could be greater than expected, 

causing some individuals in our simulations to experience higher asset 

returns. Any of these factors could raise retirement income and, possibly, 

Generation X’s replacement rate. If this were to occur, the difference in 

replacement rates between the Baby Boom and Generation X could be 

smaller than we estimate. 

Table 6: Median Household Replacement Rates for Baby Boom and Generation X 

 Baby Boom Generation X 

Social Security Tax Increase Scenario, Constant DB/DC 74.6% 68.1% 

Social Security Benefit Reduction Scenario, Constant 

DB/DC 

70.7% 60.4% 

Social Security Benefit Reduction Scenario, Generation 

X only has DC 

70.7% 60.2% 

Source: GEMINI/PENSIM. 

Note: The replacement rate is calculated as retirement income at age 62 divided by earnings at age 

61 for retired workers who worked at age 61 and whose spouses, if married, were the same age. 

Some but not all of the difference in replacement rates between generations may be explained by the 

difference in the normal retirement age. 

Our simulations suggest that retirement income will vary significantly 

within both Generation X and the Baby Boom. Retirement income will also 

vary by demographic group, with income being lower for the less educated 

and single women. 

 26In order to facilitate comparison, we examined retirement income at age 62. However, 

differences in life expectancy and health status, particularly for Generation X, may lead to 

more years in retirement and a need for more assets. If people work longer because they 

are healthier and anticipate living longer, examining retirement income at 62 may not 

capture these behavioral changes. 

The Distribution of 

Retirement Income 

Will Vary within 

Generations, and 

Certain Groups Will 

Be More Likely to 

Have Lower 

Retirement Incomes 
Page 28 GAO-03-429 Retirement Income 

Simulated retirement income will vary widely across households within 

both Generation X and the Baby Boom.27 For example, if married 

households in Generation X were arranged from lowest to highest in terms 

of their retirement incomes at age 62, the top 20 percent would receive 

over 40 percent of all retirement income while the bottom 20 percent 

would receive less than 7 percent. (See fig. 11.)28 The disparity between the 

top 20 percent and bottom 20 percent is even larger for single persons. 

Because retirement income is closely linked to earnings, which are known 

to vary significantly,29 this degree of variation in estimated retirement 

income is not surprising. 

 27Because projected distributions for the two generations are very similar we only present 

figures and tables for Generation X in this section and present the same information for the 

Baby Boomers in appendix II. The projections discussed here assume funded Social 

Security benefits, no extension of raised pension contribution limits, and the coverage 

rates for DB and DC pensions remain constant over time. The distributions under 

alternative scenarios, including employers only offering DC plans to Generation X, are also 

very similar (see app. II). 

28Simulated retirement income is pre-tax and excludes important components of retirement 

income both of which affect the degree of variation. Examining after tax income would 

most likely reduce variation because of the progressive nature of the income tax. Simulated 

income exlcudes personal savings and SSI and other forms of public assistance. Including 

personal savings would most likely increase variation as there is great variation in the 

distribution of wealth. Including SSI would raise the bottom of the distribution (see Arthur 

B. Kennickell, An Examination of Changes in the Distribution of Wealth from 1989 to 

1998: Evidence from the Survey of Consumer Finances, Federal Reserve Board (June 

2000)). 

29See U.S. Census Bureau, Current Population Reports: P60-204, The Changing Shape of the 

Nation’s Income Distribution 1947-1998, (Washington, D.C.: 2000). 

The Distribution of 

Retirement Income Will 

Vary within Both 

Generation X and the Baby 

Boom 
Page 29 GAO-03-429 Retirement Income 

Figure 11: Proportion of Household Retirement Income for Each Quintile of the 

Retirement Income Distribution at Age 62 for Generation X 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and constant rates of coverage over time for DB 

and DC pensions. 

When examining the sources of retirement income, simulated pension 

benefits are less evenly distributed than simulated Social Security benefits. 

Married couples in the top 20 percent in terms of pension benefits receive 

over 58 percent of all pension benefits while those in the bottom 20 

percent receive no benefits at all, as shown for Generation X in figure 12. 

In comparison, married couples in the top 20 percent in terms of Social 

Security benefits receive about 31 percent of all Social Security benefits, 

while those in the bottom 20 percent receive about 10 percent. 

0

10

20

30

40

50

60

70

Bottom 20% Second quintile Third quintile Fourth quintile Top 20%

Percentage of income

Married at age 62

Single at age 62

Source: GEMINI/PENSIM.

Retirement income quintiles
Page 30 GAO-03-429 Retirement Income 

Figure 12: Proportion of Household Pension Benefits and Household Social Security Benefits for Each Quintile of the Pension 

Benefit and Social Security Benefit Distributions at Age 62 for Generation X 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and constant rates of coverage over time for DB 

and DC pensions. 

Pension benefits are less evenly distributed for at least two reasons. First, 

by design, the Social Security benefit formula is more generous toward 

low-income and disabled workers, in contrast to pensions, which tend to 

play a larger role in the retirement income of higher earning workers.30

Second, some workers have no pension coverage while nearly all workers 

are covered by Social Security. In our simulations, 20 percent of married 

households and 33 percent of single individuals in Generation X receive no 

pension benefits. The median retirement income for married households 

where at least one member has a pension is almost twice as large as the 

 30U.S. General Accounting Office, Private Pension: Issues of Coverage and Increasing 

Contribution Limits for Defined Contribution Plans, GAO-01-846 (Washington, D.C.: 

Sept. 2001). 

Percentage of benefits

Source: GEMINI/PENSIM.

Pension benefit quintiles

0

10

20

30

40

50

60

70

Fourth Top 20%

quintile

Third

quintile

Second

quintile

Bottom 20%

Percentage of benefits

Married at age 62

Single at age 62

Social Security benefit quintiles

0

10

20

30

40

50

60

70

Fourth Top 20%

quintile

Third

quintile

Second

quintile

Bottom 20%
Page 31 GAO-03-429 Retirement Income 

median for married households where neither member has a pension. (See 

fig. 13.) The percentage difference between those with pensions and 

without pensions is even larger for single persons. 

Figure 13: Median Monthly Household Retirement Income at Age 62 for 

Generation X by Pension Status 

Note: Retirement income includes Social Security and pension benefits and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and constant rates of coverage over time for DB 

and DC pensions. 

Simulated retirement income varies by educational attainment, marital 

status, and gender. Simulated retirement income is lower for those with 

less education, as shown for Generation X in figure 14. The median 

retirement income for married high school dropouts is about 43 percent 

less than the median for married college graduates. The percentage 

difference between single high school dropouts and single college 

graduates is even larger. The less educated have lower Social Security and 

pension benefits due to lower lifetime earnings and lower rates of pension 

coverage. In our simulations for Generation X, 66 percent of married 

Retirement Income Varies 

by Demographic Group 

0

1,000

2,000

3,000

4,000

5,000

Single at X Y Z

age 62

Married at

age 62

Median value in 2001 dollars

Household receives no pension benefits

Household receives pension benefits

Source: GEMINI/PENSIM.
Page 32 GAO-03-429 Retirement Income 

couples without high school degrees receive pension benefits as opposed 

to 87 percent of married college graduates. 
Page 33 GAO-03-429 Retirement Income 

Figure 14: Median Monthly Household Retirement Income at Age 62 by Educational 

Attainment for Generation X 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and constant rates of coverage over time for DB 

and DC pensions. Educational attainment for married couples is defined as the attainment of the 

Generation X birth cohort member—the spouse may have attained a different level of education. 

Simulated retirement income also varies by marital status with divorced 

and never married individuals having lower retirement incomes than 

widows and married couples. (See table 7.) Median retirement incomes for 

never married persons and divorced persons are about 23 percent less and 

32 percent less, respectively, compared to that of widows. Median 

household retirement incomes for never married persons and divorced 

persons are about 58 percent less and 63 percent less, respectively, 

compared to that of married couples. Retirement incomes are less for 

Median value in 2001 dollars

Married at age 62

Single at age 62

Source: GEMINI/PENSIM.

0

1,000

2,000

3,000

4,000

5,000

Graduate

 degree

College

 graduate

Some

 college

High School

 graduate

High School

 dropout

0

1000

2000

3000

4000

5000

Graduate

 degree

College

 graduate

Some

 college

High School

 graduate

High School

 dropout
Page 34 GAO-03-429 Retirement Income 

never married persons and divorced persons, even if one compares 

retirement income per household member.31

Table 7: Median Monthly Household Retirement Income at Age 62 by Marital Status 

for Generation X, in 2001 Dollars 

 

Household 

income 

 Income per 

household member

Never married $1,572 $1,572

Married $3,757 $1,878

Widowed $2,047 $2,047

Divorced $1,389 $1,389

Source: GEMINI/PENSIM. 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Simulations assume all workers retire completely at age 62, Social Security benefits are 

reduced to funded levels, no extension of raised pension contribution limits, and constant rates of 

coverage over time for DB and DC pensions. 

How widows and married couples compare in terms of retirement income 

depends on the measure of income used. Widows have lower median 

retirement income than married couples using household income as the 

measure, but greater median retirement income using income per 

household member as the measure. (See table 7.) Whether or not married 

couples have a higher standard of living than widows depends on how 

much they save by sharing their expenses. 

Simulated retirement income is lower for single women than for single 

men, as shown for Generation X in figure 15. The median retirement 

income for single women is about 31 percent less than the median for 

single men. Again this is due to lower lifetime earnings and a lower rate of 

pension coverage. Sixty-three percent of single women in Generation X 

receive pension benefits as opposed to 74 percent of single men. 

 31Comparing the retirement incomes of single individuals to married couples is complicated 

by the difference in household size. Comparing household income without adjusting for 

household size makes married couples appear better off than they may actually be because 

their incomes must support two people instead of one. Comparing income per household 

member makes married couples look worse than they may actually be because it assumes 

there are no savings associated with cohabitation. In this case, regardless of the measure 

chosen, divorced and never married persons have lower median retirement incomes. 
Page 35 GAO-03-429 Retirement Income 

Figure 15: Median Monthly Retirement Income at Age 62 by Gender for Single 

Person Households for Generation X 

Note: Retirement income includes Social Security and pension benefits. Single individuals include 

those divorced, widowed, or never married at age 62. Simulations assume all workers retire 

completely at age 62, Social Security benefits are reduced to funded levels, no extension of raised 

pension contribution limits, and constant rates of coverage over time for DB and DC pensions. 

Variation in simulated retirement income suggests some members of both 

generations may be at greater risk of retiring with insufficient resources. 

Assessing the sufficiency of simulated retirement income is difficult 

because we do not simulate assets, earnings in retirement, and SSI and 

other public assistance programs. However, retirees who earned low 

earnings over their working years may not have substantial assets or 

earnings in retirement, and SSI provides only a very modest level of 

support and is restricted to the poorest of retirees. 

Our analysis of wealth at ages 25 to 34 and our simulations of Social 

Security and pension benefits at age 62 suggest that both the Baby Boom 

and Generation X are likely to have similar levels of retirement income in 

real terms, but that level may not support Generation X’s future living 

standards. Our analysis also indicates that across the generations, similar 

subgroups of the population are most vulnerable in retirement. 

Concluding 

Observations 

Median value in 2001 dollars

Source: GEMINI/PENSIM.

0

500

1,000

1,500

2,000

2,500

Single V W X Y Z

female

Single

male
Page 36 GAO-03-429 Retirement Income 

The levels of retirement income that Baby Boom and Generation X 

workers will actually receive depend in part upon their own behavior, 

such as how long they work or how much they save, and in part upon 

factors they cannot control, such as the performance of the overall 

economy, the rate of return on financial investments, and changes in 

Social Security and health care financing. Individuals’ behavior, and future 

economic events, may vary significantly from the assumptions underlying 

our models, especially for those workers who still have many years to 

work before retirement. In addition, estimates of future retirement income 

depend on adequate data on individuals’ earnings, wealth, and pensions, 

not all of which are easily captured in existing data sets. Further, rising 

expectations about consumption, leisure and health care in retirement 

(and the costs of meeting these expectations) could require higher 

replacement rates for Generation X than for the Baby Boom in order to 

maintain the standards of living they achieved while working. 

Government policy can potentially have an important effect on individuals’ 

retirement income. Policies that encourage individuals to acquire more 

education and training, to work longer and to save more can help ensure 

higher retirement incomes in the future. Also, any reform that 

policymakers undertake with regard to the Social Security program or 

health care financing will have repercussions for the retirement income of 

Generation X and the younger half of the Baby Boom. Our work suggests 

the importance of all these policy actions reflecting a coordinated 

approach to future retirement income, and that they be made soon enough 

so the affected individuals will have adequate time to adjust their work 

and saving behavior accordingly. Finally, the continued vulnerability of 

certain segments of the population to inadequate resources at retirement 

suggests that successful retirement income policies would take potential 

impacts on these groups into consideration. 

We provided a draft of this report to SSA, Labor, and Treasury. All three 

provided technical comments, which we have incorporated as appropriate. 

We are sending copies of this report to the Social Security Administration, 

the Department of Labor, and the Department of the Treasury. We will also 

make copies available to others on request. In addition, the report will be 

available at no charge on GAO’s Web site at http://www.gao.gov. 

Agency Comments 
Page 37 GAO-03-429 Retirement Income 

If you have any questions concerning this report, please contact Barbara 

Bovbjerg at (202) 512-7215. See appendix III for other contacts and staff 

acknowledgments. 

Sincerely yours, 

Barbara D. Bovbjerg 

Director, Education, Workforce 

 and Income Security Issues. 
Appendix I: Scope and Methodology 

Page 38 GAO-03-429 Retirement Income 

To gain an understanding of what today’s workers might expect to receive 

in terms of retirement income, we compared the wealth of current 

workers with that of current retirees, at similar points in their lives, and 

estimated the pension and Social Security benefits that the Baby Boom 

and Generation X might receive. To analyze personal wealth we used the 

Survey of Consumer Finances, a survey of U.S. households sponsored by 

the Board of Governors of the Federal Reserve System. To analyze how 

workers from the Baby Boom and Generation X compare in terms of the 

retirement income they can expect to receive and the likely distribution 

across workers within the Baby Boom and Generation X, we simulated 

expected retirement income at age 62. 

To analyze personal wealth, we used the Survey of Consumer Finances 

(SCF), a triennial survey of U.S. households sponsored by the Board of 

Governors of the Federal Reserve System with the cooperation of the U.S. 

Department of the Treasury. The SCF provides detailed information on 

U.S. households’ balance sheets and their use of financial services, as well 

as on their pensions, labor force participation, and demographic 

characteristics as of the time of the interview. The SCF also collects 

information on households’ total cash income, before taxes, for the 

calendar year preceding the survey. Because the survey is expected to 

provide reliable information both on assets that are fairly common—such 

as houses—as well as on assets that are owned by relatively few—such as 

closely held businesses—the SCF uses a sample design that includes a 

standard, geographically based random sample and a special over sample 

of relatively wealthy families. Weights are used to combine information 

from the two samples to make estimates for the full population. The 1962 

SCF was conducted by the Census Bureau and surveyed 3,551 households. 

The 1983 SCF was conducted by the Survey Research Center of the 

University of Michigan and surveyed 3,824 households. The 1998 SCF was 

conducted by the National Opinion Research Center at the University of 

Chicago and surveyed 4,309 households. 

Using the SCF, we analyzed how marital status, education, and 

homeownership are related to the wealth of households headed by a 25- to 

34-year old. Using the 1962, 1983, and 1998 SCFs, we examined the 

ownership and level of household savings for current retirees (born 

between 1925 and 1945), the Baby Boom (born between 1946 and 1964), 

and Generation X (born between 1965 and 1976) when each generation 

Appendix I: Scope and Methodology 

Analysis of Personal 

Wealth 
Appendix I: Scope and Methodology 

Page 39 GAO-03-429 Retirement Income 

was 25 to 34 years old.1 We selected this age group because this is the only 

age group for which we have data on personal wealth in each of the three 

generations. 

Our measure of personal wealth includes tax favored retirement saving, 

such as individual retirement accounts (IRA) and 401(k)s and other thrift 

type plans, as well as savings that are not specifically dedicated to 

retirement but may enhance retirement income, such as liquid financial 

assets (checking accounts, savings accounts, money market deposit 

accounts, and money market mutual funds), other financial assets 

(certificates of deposit, mutual funds, stocks, and bonds), housing assets, 

and nonhousing assets (nonresidential real estate, business interests, and 

vehicles).2

 We also looked at housing liabilities and nonhousing liabilities 

(credit cards, installment loans, and other debts). For each component of 

personal wealth, we calculated the percentage of households owning that 

type of wealth as well as the median value. We looked separately at assets 

and debt and then combined them to calculate individual net worth. 

For studies in which the focus is on saving or net worth, the SCF is 

preferable to other household income surveys, such as the Panel Study of 

Income Dynamics (PSID) or the Survey of Income and Program 

Participation (SIPP). The SCF has more detailed information about wealth 

holding, better distributional characteristics, less item nonresponse, and 

fewer imputed variables than the PSID or the SIPP.3

 However, the SCF, 

like all surveys, is subject to sampling errors, reporting errors, and 

nonresponse errors. Sampling errors result from the fact that survey 

estimates are based on a sample of the population rather than on a 

complete census of the population. Reporting errors arise because 

respondents may not understand what is wanted, may not know the 

information requested, or may be reluctant to reveal their actual income or 

wealth. Nonresponse errors arise when the family selected for 

 1

Our analysis does not include every year of each generation. We selected household heads 

age 25-34 in the SCFs corresponding to those born between 1928 and 1937; 1949 and 1958; 

and 1964 and 1973. 

2

For individuals covered by pension plans, the SCF includes amounts accumulated under 

defined contribution plans but does not capture the expected value of future benefits under 

defined benefit plans. 

3

Karen M. Pence, 401(k) and Household Saving: New Evidence from the Survey of 

Consumer Finances (Federal Reserve Board of Governors Working Paper, Dec. 2001), 4. 
Appendix I: Scope and Methodology 

Page 40 GAO-03-429 Retirement Income 

participation is not available to be interviewed, either because they refuse 

to participate or cannot be contacted. 

Further, the sample sizes for the SCF are relatively small compared with 

surveys such as the Current Population Survey. For our analysis, we are 

concerned with the fact that small samples are vulnerable to bias from 

observations not representative of the population as a whole. For all of 

these reasons, our numbers should be interpreted with some caution. 

To analyze how workers from the Baby Boom and Generation X compare 

in terms of the retirement income they can expect to receive and the likely 

distribution across workers within the Baby Boom and Generation X, we 

simulated expected retirement income at age 62. Our measure of 

retirement income consists of pension income, Social Security benefits, 

and spouse’s earnings. It does not include personal savings, earnings in 

retirement, health benefits, or income from other income support 

programs (e.g., Supplemental Security Income). For our simulations, we 

used the Social Security and Accounts Simulator (SSASIM), Genuine 

Microsimulation of Social Security and Accounts (GEMINI), and Pension 

Simulator (PENSIM) simulation models. GEMINI estimated Social Security 

benefits and PENSIM estimated pension income from defined benefit and 

defined contribution plans for the 1955 birth cohort (Baby Boom) and the 

1970 birth cohort (Generation X) and their spouses. Retirement income 

and its components were discounted to 2001 dollars, allowing us to make 

comparisons across cohorts in terms of the level of retirement income. 

However, these comparisons do not give an indication of standards of 

living in retirement. To make this comparison, we looked at the earnings 

replacement rate, calculated as retirement income at age 62 divided by 

earnings at age 61 for retired workers who worked at age 61 and whose 

spouse, if married, was the same age. 

To examine the distribution of retirement income within both generations, 

we calculated the degree of variation by arranging households by 

retirement income and finding the proportion of that income received by 

each quintile.4

 To compare groups by demographics, we calculated median 

retirement income by educational attainment, gender, and marital status. 

Due to the difference in household size, we performed most of the above 

 4

These calculations were repeated for pension income and Social Security benefits 

separately. 

Analysis of Simulated 

Retirement Income 
Appendix I: Scope and Methodology 

Page 41 GAO-03-429 Retirement Income 

calculations separately for married couples and singles—those widowed, 

divorced, or never married—at age 62. When examining retirement income 

by marital status we calculated both household income and income per 

household member.5

SSASIM6

 is a Social Security policy simulation model developed by the 

Policy Simulation Group (PSG). The initial version of the model was 

developed under a series of contracts from the Social Security 

Administration as part of the 1994-96 Advisory Council on Social Security. 

SSASIM consists of two models, a macro model of aggregate program 

finances, and an embedded micro model of selected cohort individuals. In 

addition to current law policy, the model can simulate a variety of policy 

reforms, from incremental changes to broader structural reforms that 

would introduce individual accounts into the broader Social Security 

system. 

GEMINI7

 is a policy microsimulation model also developed by the PSG. 

GEMINI is useful for analyzing the lifetime implications of Social Security 

policies for a large sample of people born in the same year and can 

simulate different reform features for their effects on the level and 

distribution of benefits. GEMINI uses as input birth cohort samples 

generated by PENSIM so as to represent the demographic and economic 

characteristics of historical birth cohorts. Also, GEMINI incorporates the 

same kind of Old Age, Survivor and Disability Insurance (OASDI) program 

logic as used in the micro model of SSASIM, with almost all assumption 

and policy parameters read from a SSASIM input database. GEMINI 

produces output files that contain detailed information about the life 

 5

Comparing the retirement incomes of single individuals to married couples is complicated 

by the difference in household size. Rather than arbitrarily choosing an equivalence scale, 

we bounded the problem by comparing household income and income per household 

member. Comparing household income without adjusting for household size provides an 

upper bound for the income of married couples relative to the income of singles because it 

assumes that total household living expenses for two people are the same as for one. 

Comparing income per household member provides a lower bound for the income of 

married couples relative to the income of singles because it assumes there are no savings 

associated with cohabitation. 

6

For more information on SSASIM go to http://www.polsim.com/SSASIM.html. 

7

For more information on GEMINI go to http://www.polsim.com/GEMINI.html. 

SSASIM 

GEMINI 
Appendix I: Scope and Methodology 

Page 42 GAO-03-429 Retirement Income 

events and annual OASDI program experience of each individual in the 

cohort sample. 

For our report, the PSG produced the GEMINI output files using the same 

1955 and 1970 birth cohorts used in PENSIM for both a scheduled and 

funded Social Security scenario (see following paragraphs for more 

details.) The PENSIM and GEMINI output files were then merged, yielding 

an output file containing yearly Social Security benefits, pension income, 

and spouse’s earnings from age 62 until death for each member of the 

cohort. 

PENSIM8

 is a pension policy simulation model that is being developed by 

the PSG to analyze lifetime coverage and adequacy issues related to 

employer-sponsored pension plans. The development of PENSIM has been 

funded since 1997 by the Office of Policy and Research at the Employee 

Benefits Security Administration of the U.S. Department of Labor. PENSIM 

produces a random sample of simulated life histories for 100,000 people in 

a birth cohort and for their spouses who may have been born in a different 

year. The members of the birth cohort experience demographic and 

economic events, the incidence and timing of which vary by age, gender, 

education, disability, and employment status. The types of life events that 

are modeled in PENSIM include: 

• demographic events (birth, death); 

• schooling events (leaving school at a certain age, receiving a certain 

educational credential); 

• family events (marriage, divorce, childbirth); 

• disability events; 

• initial job placement; 

• job mobility events (earnings increases while on a job, duration of a job, 

movement to a new job, or out of the labor force); 

• pension events (becoming eligible for plan participation, choosing to 

participate, becoming vested, etc.); and 

• retirement events. 

For our report, we specified a DB and DC pension plan, which the PSG 

entered into PENSIM to be used with the 1955 and 1970 birth cohorts to 

simulate pension benefits for the Baby Boom and Generation X. These 

 8

For more information on PENSIM go to http://www.polsim.com/PENSIM.html. 

PENSIM 
Appendix I: Scope and Methodology 

Page 43 GAO-03-429 Retirement Income 

simulations were conducted under both a sunset and no sunset pension 

scenario as well a scenario where Generation X only had access to DC 

pensions (see following discussion for more details). 

Our simulations assume a single type of DB pension plan for all workers 

covered by such a plan. This plan’s structure is similar to the most 

common type of DB pension plan9

 in the private sector.10

In terms of structure, this plan has an eligibility requirement (consisting of 

a minimum age of 21 and 1 year of service) and 5 years cliff vesting. The 

plan’s normal retirement age is 62 for workers with any years of service, 

and it has an early retirement option, with early retirement benefits 

beginning at age 55 for workers with 10 years of service. If a worker 

chooses to retire early there is a linear early retirement reduction of 5 

percent per year (e.g., if a worker retires at age 55, he would receive 65 

percent of the normal retirement benefit).11 The plan pays a monthly 

benefit at retirement, rather than a lump sum. 

In terms of the calculation of benefits, the traditional DB plan calculates 

benefits using a final average pay formula, such as: 

X% * average Y years earnings at the end of career or when highest * years 

of service. 

Surveys of DB plans in the United States indicate that, typically, the 

percentage credit (X%) is in the range of 1-1.75 percent.12 For this report 

 9

This section relies on data from the forthcoming report, Martin R. Holmer and Asa M. 

Janney III, Policy Simulation Group. Characteristics of Pension Plans in the United 

States, 1996-98, a report prepared at the request of the U.S. Department of Labor, 

Employee Benefits Security Administration, Office of Policy and Research, Feb. 25, 2003. 

10However, DB plans in the future may differ as firms have been increasingly switching to 

cash balance plans. Cash balance plans are a type of DB plan that combine certain features 

found in both DB and DC plans. Participants’ benefits are determined by a formula, like a 

DB plan, but benefits are expressed as account balances, similar to DC plans. U.S. General 

Accounting Office, Cash Balance Plans: Implications for Retirement Income, 

GAO/HEHS-00-207 (Washington, D.C.: Sept. 29, 2000) and Answers to Key Questions About 

Private Pension Plans, GAO-02-745SP (Washington, D.C.: Sept. 18, 2002). 

11In our simulations all individuals retire at age 62. 

12See U.S. Department of Labor, Bureau of Labor Statistics, Employee Benefits in Medium 

and Large Private Establishments, 1997, Bulletin 2517 (Washington, D.C.: Sept. 1999) and 

U.S. General Accounting Office, Private Pensions: Implications of Conversions to Cash 

Blance Plans, GAO/HEHS-00-185 (Washington, D.C.: Sept. 29, 2000). 

Defined Benefit Plan 
Appendix I: Scope and Methodology 

Page 44 GAO-03-429 Retirement Income 

we chose 1.25 percent. The most common definition of final average pay is 

the high consecutive 5 years of earnings. Therefore, the formula that we 

use to calculate DB benefits is: 

1.25% * average of high consecutive 5 years pay * years of service. 

In our simulations of DC plans, all individuals covered by a DC pension 

plan are covered by the same plan. This plan’s structure is similar to the 

most common type of DC pension plan13 in the private sector.14

In terms of structure, this plan has an eligibility requirement (consisting of 

a minimum age of 21 and 1 year of service) and 5 year graded vesting.15 At 

retirement,16 individuals annuitize their account balances,17 with married 

individuals purchasing a joint and one-half survivor annuity and single 

individuals purchasing a single life annuity. 

Employees can contribute up to 12 percent of their earnings18 and the 

employer match 50 percent of the employees’ contributions up to 5 

percent.19 Employees can invest their contributions in their choice of 

equities and fixed income assets, where the fixed income assets will 

 13This section relies on data from the forthcoming report, Martin R. Holmer and Asa M. 

Janney III, Policy Simulation Group. Characteristics of Pension Plans in the United 

States, 1996-98, a report prepared at the request of the U.S. Department of Labor, 

Employee Benefits Security Administration, Office of Policy and Research, Feb. 25, 2003. 

14This plan will most likely resemble a 401(k) plan. 

15Graded vesting implies that an employee’s nonforfeitable percentage of the employer 

contributions increases over time until it reaches 100 percent. In our simulations the 

nonforfeitable percentage reaches 100 percent after 5 years. 

16In our estimates all individuals retire at age 62. 

17In our simulations all individuals are assumed to purchase a nominal annuity. 

18The dollar limit on employee contributions is $11,000 for 2002, increasing by $1,000 per 

year until reaching $15,000 in 2006 and is then adjusted for inflation in $500 increments. 

19By law, combined employer and employee contributions are limited to the lesser of 

$35,000 or 25 percent of compensation in 2001. Beginning in 2006, combined contributions 

will be limited to the lesser of $40,000 (indexed for inflation) or 100 percent of 

compensation. 

Defined Contribution Plan 
Appendix I: Scope and Methodology 

Page 45 GAO-03-429 Retirement Income 

consist of Treasury bonds and corporate bonds.20 Employees who leave 

before retirement can choose to have their account balances rolled over 

into another retirement account. In our simulations, rollover decisions are 

based on the data in table 11. 

Assumptions also need to be made regarding participation and 

contribution rates, and asset allocation. Tables 8-11 provide information 

on the assumptions used for each of these factors. Table 8 provides data 

on participation rates by age and salary. 

Table 8: Participation Rates by Age and Salary, 2001 

Age <$20,000 $20,000-$39,999 $40,000-$59,999 $60,000-$79,999 $80,000-$99,999 >$100,000

<20 17.2% 44.4% a a a a 

20-29 32.1% 65.9% 78.0% 91.2% 93.1% 95.0%

30-39 45.2% 79.5% 89.0% 94.1% 95.6% 97.0%

40-49 49.9% 83.2% 88.0% 95.0% 96.8% 97.5%

50-59 57.7% 85.5% 83.7% 93.8% 96.6% 97.9%

60+ 64.0% 86.7% 83.6% 90.3% 94.7% 96.2%

Source: Research Report: How Well are Employees Saving and Investing in 401(k) Plans, Hewitt Financial Services, 2001. 

Note: In order to use these participation rates in our simulations, the salary categories listed in the 

table were normalized by dividing by the average wage index in 2001. 

a

Not applicable. 

Data on contribution rates by age and salary are shown in table 9. 

Table 9: Contribution Rates by Age and Salary, 1999 

Age <$20,000 >$20,000-$40,000 >$40,000-$60,000 >$60,000-$80,000 >$80,000-$100,000 >$100,000

20-29 5.1% 5.3% 6.8% 7.4% 6.8% 4.8%

30-39 6.4% 6.2% 6.8% 7.2% 6.9% 5.1%

40-49 6.9% 6.7% 7.1% 7.3% 6.8% 5.0%

50-59 7.8% 7.6% 8.3% 8.2% 7.3% 5.1%

60+ 9.0% 8.5% 9.3% 9.0% 7.9% 5.1%

Source: Contribution Behavior of 401(k) Plan Participants, Sarah Holden and Jack VanDerhei, ICI Perspective, vol. 7/no. 4, October 2001 and Research Report: How Well Are Employees Saving and 

Investing in 401(k) Plans, Hewitt Financial Services, 2001. 

 20The mean nominal rates of return, which all returns varied around, for each asset class 

was 6.3 percent for Treasuries, 6.8 percent for corporate bonds, and 10 percent for equities, 

consistent with the assumptions used by the Office of the Chief Actuary at the Social 

Security Administration. 
Appendix I: Scope and Methodology 

Page 46 GAO-03-429 Retirement Income 

Note: Since high income individuals are constrained by limits on total contributions within a given 

year, and the rates in this table fall at higher salary levels, we used the data for the >$60,000 to 

$80,000 salary range for those salaried above $80,000. In order to use these contribution rates in our 

simulations, the salary categories listed in the table were normalized by dividing by the average wage 

index in 1999. 

Table 10 provides data on average asset allocation rates by age and 

investment options. 

Table 10: Average Asset Allocation Rates by Age and Investment Options, 2000 

Age 

Equity 

Funds

Balanced 

Funds 

Bond 

Funds 

Money 

Funds

20-29 77.7% 8.0% 7.1% 5.8%

30-39 78.7% 8.6% 6.4% 4.7%

40-49 74.1% 9.7% 7.7% 6.1%

50-59 67.4% 10.8% 9.3% 8.4%

60+ 55.8% 12.5% 13.8% 12.4%

Source: 404(k) Plan Asset Allocation, Account Balances, and Loan Activity in 2000, Sarah Holden and Jack VanDerhei, ICI 

Perspectives, vol. 7/no. 5, November 2001. 

Note: Because the model we used has different investment categories than those listed in the table, 

money funds were put into Treasury bonds, bond funds were put into corporate bonds, and balanced 

funds were split evenly between equities and corporate bonds. Percentages in the table are percent 

of account balances. 

Data on the distribution of assets at termination by asset levels is shown in 

table 11. 

Table 11: Assets at Termination, 2000 

Assets 

Stayed 

in plan 

Rolled 

over

Cashed 

out 

<$10,000 21% 48% 32% 

$10,000-$49,999 62% 27% 11% 

$50,000-$99,999 69% 27% 4% 

$100,000-$199,999 69% 28% 2% 

$200,000+ 69% 29% 2% 

Source: Building Futures: How Workplace Savings are Shaping the Future of Retirement, Fidelity Investments, 2001. 

Note: In our simulations, if a job ends without disability or retirement, the individual has the choice to 

rollover the funds to another retirement account. The percentages in the cashed out category were 

used as the probability of not rolling the funds into another retirement account at termination. Also, 

the dollar amounts were normalized by dividing by the average wage index in 2000. 
Appendix I: Scope and Methodology 

Page 47 GAO-03-429 Retirement Income 

Our simulations considered several scenarios for pension benefits. One 

assumed that the sunset provision in the Economic Growth and Tax Relief 

Reconciliation Act (EGTRRA) of 2001 holds21 and the other that the 

provisions in EGTRRA, which raise the limits on both DB and DC plans, do 

not sunset.22 We also considered the scenario where the shift in coverage 

reached its extreme and Generation X only had access to DC plans. 

Our simulations of expected Social Security benefits consider two 

different scenarios23 for resolving the funding shortfall. One scenario 

assumes scheduled benefits are paid while payroll taxes are increased to 

levels that support those benefits. Our scheduled benefits scenario 

increases the payroll tax once and immediately by the amount of the 

OASDI actuarial deficit as a percent of payroll so that benefits under the 

current system can continue to be paid throughout the simulation period. 

The other scenario, the funded benefits scenario, assumes that benefits are 

reduced to levels supportable by current payroll tax rates. The benefit 

reductions used in this scenario reduce the primary insurance amount 

(PIA) formula factors by equal percentage point reductions (by 0.319 each 

year for 30 years) for those newly eligible in 2005, subjecting earnings 

across all segments of the PIA formula to the same reduction. 

Simulating retirement income almost 30 years into the future requires 

many assumptions and simplifications and, consequently, our simulations 

have a number of limitations. A primary limitation of our analysis is that 

our simulations do not include important components of retirement 

income such as personal savings, earnings in retirement, health benefits, 

 21The sunset provision would return any changes made under EGTRRA to their previous 

levels. 

22See appendix II for figures and tables showing the level of real retirement income, 

replacement rates, and distributional statistics for the no sunset scenario. 

23For additional information on the benchmarks, see U.S. General Accounting Office, Social 

Security: Program’s Role in Helping Ensure income Adequacy, GAO-02-62 (Washington, 

D.C.: Nov. 30, 2001) and Social Security Reform: Analysis of Reform Models Developed by 

the President’s Commission to Strengthen Social Security, GAO-03-310 (Washington, D.C.: 

Jan. 15, 2003). 

Alternative Scenarios for 

Pensions and Social 

Security 

Pensions 

Social Security

Assumptions and 

Limitations of the 

Simulation Analysis 
Appendix I: Scope and Methodology 

Page 48 GAO-03-429 Retirement Income 

and other public assistance programs such as SSI. Including personal 

savings might reduce retirement income for Generation X relative to 

retirement income for the Baby Boom if the post-1980 decline in personal 

savings rates continues.24 Including earnings in retirement might increase 

Generation X’s retirement income relative to the Boomers income if wages 

increase over time or if people in the future are more likely to work in 

retirement. From a distributional perspective, including personal savings 

would probably increase the upper quintile’s share of retirement income25

while including public assistance programs such as SSI would benefit the 

bottom of the distribution. Another component of well-being in retirement 

that we do not estimate are private and public health benefits. Including 

health benefits might reduce Generation X’s standard of living in 

retirement relative to the Baby Boom due to falling health benefits and 

rising health care costs over time 

An important assumption driving our results is that real wages grow over 

time. We assume real wages grow at 1.0 percent per year, following the 

2001 Social Security Trustees Report’s26 intermediate assumption. If, 

instead, wages stagnate as in the 1980s and 1990s, then retirement income 

for Generation X relative to retirement income for the Baby Boom might 

be lower than our estimates. 

Another critical assumption is the relative rate of DB and DC pension 

coverage. Over the last 25 years pension coverage has been shifting from 

DB to DC pensions. However, due to the uncertainty in predicting future 

relative coverage rates, our simulations either assume a constant rate of 

DB and DC coverage over time or only DC coverage for Generation X. The 

likely outcome is somewhere in between. 

 24On the other hand, over the same period household net worth increased potentially 

offsetting the impact of reduced saving rates on eventual assets in retirements. See U.S. 

General Accounting Office, National Saving: Answers to Key Questions, GAO-01-591SP

(Washington, D.C.: June 2001). 

25According to one analysis of the Survey of Consumer Finances, the top 10 percent of the 

wealth distribution held nearly 70 percent of all wealth. Arthur B. Kennickell, An 

Examination of Changes in the Distribution of Wealth from 1989 to 1998: Evidence 

from the Survey of Consumer Finances, Federal Reserve Board (June 2000). 

26The Board of Trustees, Federal Old-Age and Surviviors Insurance and Disability Insurance 

Trust Funds, The 2001 Annual Report of the Board of Trustees of the Federal Old-Age and 

Survivors Insurance and Disability Insurance Trust Funds (Washington, D.C.: Mar. 19, 

2001). 
Appendix I: Scope and Methodology 

Page 49 GAO-03-429 Retirement Income 

An important omission under the scheduled Social Security benefit 

scenario is the impact of higher taxes or general revenue transfers on 

other sources of retirement income. Increased taxes or general revenue 

transfers will most likely be necessary to pay Social Security benefits as 

scheduled under current law. Tax increases might reduce saving for 

retirement and general revenue transfers might reduce funding for other 

government retirement programs such as SSI, Medicare, or Medicaid. The 

impact of tax increases may be larger for Generation X than for the Baby 

Boom because they will pay higher taxes for more years. 

Another limitation is the sensitivity of estimated DC benefits to our 

assumptions about future rates of return. We assume individuals’ rates of 

returns vary randomly around average rates projected by the Office of the 

Chief Actuary at SSA.27 If average rates of return in the future are 

significantly different, then actual DC benefits could differ substantially 

from our simulations. While the model allows returns to vary 

stochastically by individuals, it cannot capture fluctuations in overall 

market rates of return. An ill timed stock market downturn could result in 

either generation’s DC benefits being significantly lower than simulated. 

Retirement income for Generation X could be more sensitive to future 

rates of return than retirement income for the Baby Boom, if the trend 

toward DC pensions continues. 

Another limiting assumption is that our simulations only include one kind 

of DB and DC plan, which clearly does not capture the full complexity of 

pension plans.28 We attempted to choose the characteristics of each to be 

typical of today’s pension plans. If they are not truly representative or if 

the characteristics of DB and DC plans change over time, then our results 

could be biased. In particular, the finding that the shift to DC plans only 

has a very modest effect on pension benefits may depend on our choice of 

plans. 

While educational attainment has been increasing over time, this is not 

captured by the simulations. Both generations are assumed to achieve the 

same level of education as 35- to 44-year olds in the 1997 Current 

Population Survey. Higher levels of education for Generation X could 

increase their retirement income relative to the Baby Boom. 

 27The mean nominal rates of return, which all returns varied around for each asset class 

was 6.3 percent for Treasuries, 6.8 percent for corporate bonds, and 10 percent for equities. 

28We did not examine the relative generosity of our DB and DC plans. 
Appendix I: Scope and Methodology 

Page 50 GAO-03-429 Retirement Income 

From a distributional perspective, the simulations are limited, in that they 

do not capture differences across the generations in the variation of 

earnings. By some measures, earnings disparity has been increasing over 

the last 20 years,29 which could potentially lead to more variation in 

retirement income for Generation X. 

The simulations assume the same cohort life expectancies as the 2001 

Social Security Trustees Report’s intermediate cost projection. Marital 

status at age 62 is calibrated to unpublished projections from the SSA’s 

Office of the Chief Actuary. Assumed life expectancies may be too low, as 

some have argued that the Trustees underestimate future improvements in 

mortality rates.30 Increased life expectancies would reduce DC benefits in 

our simulations because retirees would have to pay higher prices when 

annuitizing their retirement accounts. 

Our simulations of retirement income do not take taxation into account. 

Incorporating taxes would not only lower disposable income, but would 

also reduce variation in income because federal tax rates are progressive 

and because only relatively higher income households are required to pay 

tax on their Social Security benefits. 

Finally, we are only able to simulate retirement income for two illustrative 

birth cohorts as opposed to entire generations. The 1955 and 1970 birth 

 29Since the late 1960s inequality in individual earnings has been increasing as measured by 

Gini coefficients and the ratio of the 90th percentile to the 10th percentile. From the late 

1960s to the early 1990s inequality in household income increased as measured by the 

share of aggregate income by income quintile. U.S. Bureau of the Census, The Changing 

Shape of the Nation’s Income Distribution 1947-1998, Current Population Reports P60-

204 (Washington, D.C.: June 2000). 

30Social Security Advisory Board, The 1999 Technical Panel on Assumptions and Methods: 

Report to the Social Security Advisory Board, (Nov. 1999). 
Appendix I: Scope and Methodology 

Page 51 GAO-03-429 Retirement Income 

cohorts may not fully capture the experiences of the Baby Boom and 

Generation X, respectively.
Appendix II: Alternative Scenarios 

Page 52 GAO-03-429 Retirement Income 

For our analysis of estimated retirement income, we used two different 

scenarios for the changes to the pension limits under EGTRRA. One 

assumed that the sunset provision in EGTRRA holds and the other that the 

provisions, which raise the limits on both DB and DC plans, do not sunset. 

The following tables show estimated retirement income under the nosunset pension scenario. Extending pension contribution limits beyond 

2010 increases real retirement income and replacement rates for 

Generation X relative to real retirement income and replacement rates for 

the Baby Boom. 

Table 12 shows the estimated median monthly household retirement 

income at age 62 under a scheduled (tax increase) Social Security scenario 

and a constant rate of DB and DC pension coverage. 

Table 12: Median Monthly Household Retirement Income and its Major 

Components, at Age 62, if Social Security Shortfall Addressed by Increasing 

Revenues 

 Baby Boom Generation X 

Retirement income $3,156 $3,481 

Pension income (DB and DC) $966 $1015 

Social Security benefits $1,366 $1,549 

Source: GEMINI/PENSIM. 

Note: Median values at age 62 discounted to 2001 dollars and DC account balances annuitized at 

retirement. Not all components of retirement income are shown. Pension income is measured across 

all individuals in the cohort. Median pension income for those covered by a pension is $1,509 for the 

Baby Boom and $1,589 for Generation X. The rates of return for DC pension contributions vary over 

time and by individual. Median spousal earnings for those spouses working are $3,295 for the Baby 

Boom and $3,375 for Generation X. 

Estimated median monthly household retirement income at age 62 under a 

funded (benefit reduction) Social Security scenario and a constant rate of 

DB and DC pension coverage is shown in table 13. 

Appendix II: Alternative Scenarios 

Retirement Income 

Under the No-Sunset 

Pension Scenario 
Appendix II: Alternative Scenarios 

Page 53 GAO-03-429 Retirement Income 

Table 13: Median Monthly Household Retirement Income and its Major 

Components, at Age 62, if Social Security Shortfall addressed by Reducing Benefits 

 Baby Boom Generation X

Retirement income $3,021 $3,110

Pension income (DB and DC) $966 $1015

Social Security benefits $1,234 $1,199

Source: GEMINI/PENSIM. 

Note: Median values at age 62 discounted to 2001 dollars and DC account balances annuitized at 

retirement. Not all components of retirement income are shown. Pension income is measured across 

all individuals in the cohort. Median pension income for those covered by a pension is $1,509 for the 

Baby Boom and $1,589 for Generation X. The rates of return for DC pension contributions vary over 

time and by individual. Median spousal earnings for those spouses working are $3,295 for the Baby 

Boom and $3,375 for Generation X. 

Table 14 shows the simulated median monthly household retirement 

income at age 62 under a funded (benefit reduction) Social Security 

scenario and Generation X having only DC pension coverage. 

Table 14: Median Monthly Household Retirement Income and its Major 

Components, at Age 62, if Social Security Shortfall Addressed by Reducing 

Benefits and Generation X Having Only DC Pension Plans 

 Baby Boom Generation X 

Retirement income $3,021 $3,195 

Pension income (DB and DC) $966 $1065 

Social Security benefits $1,234 $1,199 

Source: GEMINI/PENSIM. 

Note: Median values at age 62 discounted to 2001 dollars and DC account balances annuitized at 

retirement. Not all components of retirement income are shown. Pension income is measured across 

all individuals in the cohort. Median pension income for those covered by a pension is $1,509 for the 

Baby Boom and $1,835 for Generation X. The rates of return for DC pension contributions vary over 

time and by individual. Median spousal earnings for those spouses working are $3,295 for the Baby 

Boom and $3,375 for Generation X. 

Replacement rates for the Baby Boom and Generation X under the 

different Social Security and pension coverage scenarios are shown in 

table 15. 
Appendix II: Alternative Scenarios 

Page 54 GAO-03-429 Retirement Income 

Table 15: Median Household Replacement Rates for Baby Boom and Generation X 

Baby Boom Generation X

Social Security Tax Increase Scenario, constant DB/DC 74.9% 70.9%

Social Security Benefit Reduction Scenario, constant DB/DC 71.0% 63.3%

Social Security Benefit Reduction Scenario, Generation X only has DC 71.0% 62.5%

Source: GEMINI/PENSIM. 

Note: The replacement rate is calculated as retirement income at age 62 divided by earnings at age 

61 for retired workers who worked at age 61 and whose spouses, if married, were the same age. 

The distribution of simulated retirement income is very similar across the 

generations and across scenarios. For both generations and in all 

scenarios, retirement income is estimated to vary widely, pension benefits 

are less evenly distributed than Social Security benefits, and the less 

educated, single women, and those without pensions have lower 

retirement incomes. 

Figures 16-20 and table 16 show the estimated distribution of retirement 

income for the Baby Boom assuming funded Social Security benefits, no 

extension of raised pension contribution limits beyond 2010, and a 

constant rate of DB and DC pension coverage over time. These are the 

same assumptions used for Generation X in figures 11-15 and table 7. We 

do not emphasize a comparison of the distributions across generations 

because our models do not capture differences across generations in the 

variation of earnings. By some measure earnings disparity has been 

increasing over the last 20 years,1

 which may result in retirement income 

varying more in Generation X than in the Baby Boom. 

 1

U.S. Bureau of the Census, The Changing Shape of the Nation’s Income Distribution 

1947-1998, Current Population Reports: P60-204 (Washington, D.C.: June 2000). 

Distributional Figures 

and Tables for the 

Baby Boom and for 

Generation X under 

Alternative Scenarios 
Appendix II: Alternative Scenarios 

Page 55 GAO-03-429 Retirement Income 

Figure 16: Proportion of Household Retirement Income for Each Quintile of the 

Retirement Income Distribution at Age 62 for the Baby Boom 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and constant rates of coverage over time for DB 

and DC pensions. 

0

10

20

30

40

50

60

70

Bottom 20% Second quintile Third quintile Fourth quintile Top 20%

Percentage of income

Married at age 62

Single at age 62

Source: GEMINI/PENSIM.

Retirement income quintiles
Appendix II: Alternative Scenarios 

Page 56 GAO-03-429 Retirement Income 

Figure 17: Proportion of Household Pension Benefits and Household Social Security Benefits for Each Quintile of the Pension 

Benefit and Social Security Benefit Distributions at Age 62 for the Baby Boom 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and constant rates of coverage over time for DB 

and DC pensions. 

Percentage of benefits

Source: GEMINI/PENSIM.

Pension benefit quintiles

0

10

20

30

40

50

60

70

Fourth Top 20%

quintile

Third

quintile

Second

quintile

Bottom 20%

Percentage of benefits

Married at age 62

Single at age 62

Social Security benefit quintiles

0

10

20

30

40

50

60

70

Fourth Top 20%

quintile

Third

quintile

Second

quintile

Bottom 20%
Appendix II: Alternative Scenarios 

Page 57 GAO-03-429 Retirement Income 

Figure 18: Median Monthly Household Retirement Income at Age 62 by Pension 

Status for the Baby Boom 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and constant rates of coverage over time for DB 

and DC pensions 

0

1,000

2,000

3,000

4,000

5,000

Single at X Y Z

age 62

Married at

age 62

Median value in 2001 dollars

Household receives no pension benefits

Household receives pension benefits

Source: GEMINI/PENSIM.
Appendix II: Alternative Scenarios 

Page 58 GAO-03-429 Retirement Income 

Figure 19: Median Monthly Household Retirement Income at Age 62 by Educational 

Attainment for the Baby Boom 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and constant rates of coverage over time for DB 

and DC pensions. Educational attainment for married couples is defined as the attainment of the 

Baby Boom cohort member—the spouse may have attained a different level of education. 

Median value in 2001 dollars

Married at age 62

Single at age 62

Source: GEMINI/PENSIM.

0

1,000

2,000

3,000

4,000

5,000

Graduate

 degree

College

 graduate

Some

 college

High School

 graduate

High School

 dropout

0

1000

2000

3000

4000

5000

Graduate

 degree

College

 graduate

Some

 college

High School

 graduate

High School

 dropout
Appendix II: Alternative Scenarios 

Page 59 GAO-03-429 Retirement Income 

Figure 20: Median Monthly Retirement Income at Age 62 by Gender for Single 

Person Households for the Baby Boom 

Note: Retirement income includes Social Security and pension benefits. Single individuals include 

those divorced, widowed, or never married at age 62. Simulations assume all workers retire 

completely at age 62, Social Security benefits are reduced to funded levels, no extension of raised 

pension contribution limits, and constant rates of coverage over time for DB and DC pensions. 

Table 16: Median Monthly Household Retirement Income at Age 62 by Marital Status 

for the Baby Boom, in 2001 Dollars 

 Household income Income per household member

Never married $1,546 $1,546

Married $3,783 $1,891

Widowed $2,039 $2,039

Divorced $1,399 $1,399

Source: GEMINI/PENSIM. 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and constant rates of coverage over time for DB 

and DC pensions. 

Figures 21-25 and table 17 show the estimated distribution of retirement 

income for Generation X assuming funded Social Security benefits, no 

extension of raised pension contribution limits beyond 2010, and all 

pensions are DC pensions. 

Median value in 2001 dollars

Source: GEMINI/PENSIM.

0

500

1,000

1,500

2,000

2,500

Single V W X Y Z

female

Single

male
Appendix II: Alternative Scenarios 

Page 60 GAO-03-429 Retirement Income 

Figure 21: Proportion of Household Retirement Income for Each Quintile of the 

Retirement Income Distribution at Age 62 for Generation X When All Pensions Are 

DC Pensions 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and employers with pension plans only offer DC 

pensions. 

0

10

20

30

40

50

60

70

Bottom 20% Second quintile Third quintile Fourth quintile Top 20%

Percentage of income

Married at age 62

Single at age 62

Source: GEMINI/PENSIM.

Retirement income quintiles
Appendix II: Alternative Scenarios 

Page 61 GAO-03-429 Retirement Income 

Figure 22: Proportion of Household Pension Benefits and Household Social Security Benefits for Each Quintile of the Pension 

Benefit and Social Security Benefit Distributions at Age 62 for Generation X When all Pensions are DC Pensions 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and employers with pension plans only offer DC 

pensions. 

Percentage of benefits

Source: GEMINI/PENSIM.

Pension benefit quintiles

0

10

20

30

40

50

60

70

Fourth Top 20%

quintile

Third

quintile

Second

quintile

Bottom 20%

Percentage of benefits

Married at age 62

Single at age 62

Social Security benefit quintiles

0

10

20

30

40

50

60

70

Fourth Top 20%

quintile

Third

quintile

Second

quintile

Bottom 20%
Appendix II: Alternative Scenarios 

Page 62 GAO-03-429 Retirement Income 

Figure 23: Median Monthly Household Retirement Income at Age 62 by Pension 

Status for Generation X When All Pensions Are DC Pensions 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and employers with pension plans only offer DC 

pensions. 

0

1,000

2,000

3,000

4,000

5,000

Single at X Y Z

age 62

Married at

age 62

Median value in 2001 dollars

Household receives no pension benefits

Household receives pension benefits

Source: GEMINI/PENSIM.
Appendix II: Alternative Scenarios 

Page 63 GAO-03-429 Retirement Income 

Figure 24: Median Monthly Household Retirement Income at Age 62 by Educational 

Attainment for Generation X When All Pensions Are DC Pensions 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

no extension of raised pension contribution limits, and employers with pension plans only offer DC 

pensions. Educational attainment for married couples is defined as the attainment of the Baby Boom 

cohort member—the spouse may have attained a different level of education. 

Median value in 2001 dollars

Married at age 62

Single at age 62

Source: GEMINI/PENSIM.

0

1,000

2,000

3,000

4,000

5,000

Graduate

 degree

College

 graduate

Some

 college

High School

 graduate

High School

 dropout

0

1000

2000

3000

4000

5000

Graduate

 degree

College

 graduate

Some

 college

High School

 graduate

High School

 dropout
Appendix II: Alternative Scenarios 

Page 64 GAO-03-429 Retirement Income 

Figure 25: Median Monthly Retirement Income at Age 62 by Gender for Single 

Person Households for Generation X When All Pensions are DC Pensions 

Note: Retirement income includes Social Security and pension benefits. Single individuals include 

those divorced, widowed, or never married at age 62. Simulations assume all workers retire 

completely at age 62, Social Security benefits are reduced to funded levels, no extension of raised 

pension contribution limits, and employers with pension plans only offer DC pensions. 

Table 17: Median Monthly Household Retirement Income at Age 62 by Marital Status 

for Generation X When All Pensions are DC Pensions, in 2001 Dollars 

 Household income Income per household member

Never married $1,528 $1,528

Married $3,892 $1,946

Widowed $2,145 $2,145

Divorced $1,358 $1,358

Source: GEMINI/PENSIM. 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Simulations assume all workers retire completely at age 62, Social Security benefits are 

reduced to funded levels, no extension of raised pension contribution limits, and employers with 

pension plans only offer DC pensions. 

Figures 26-30 and table 18 show the estimated distribution of retirement 

income for Generation X assuming funded Social Security benefits, 

extension of raised pension contribution limits beyond 2010, and a 

constant rate of DB and DC pension coverage over time. 

Median value in 2001 dollars

Source: GEMINI/PENSIM.

0

500

1,000

1,500

2,000

2,500

Single V W X Y Z

female

Single

male
Appendix II: Alternative Scenarios 

Page 65 GAO-03-429 Retirement Income 

Figure 26: Proportion of Household Retirement Income for Each Quintile of the 

Retirement Income Distribution at Age 62 for Generation X with Extension of Raised 

Pension Contribution Limits 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

extension of raised pension contribution limits, and constant rates of coverage over time for DB and 

DC pensions. 

0

10

20

30

40

50

60

70

Bottom 20% Second quintile Third quintile Fourth quintile Top 20%

Percentage of income

Married at age 62

Single at age 62

Source: GEMINI/PENSIM.

Retirement income quintiles
Appendix II: Alternative Scenarios 

Page 66 GAO-03-429 Retirement Income 

Figure 27: Proportion of Household Pension Benefits and Household Social Security Benefits for Each Quintile of the Pension 

Benefit and Social Security Benefit Distributions at Age 62 for Generation X with Extension of Raised Pension Contribution 

Limits 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

extension of raised pension contribution limits, and constant rates of coverage over time for DB and 

DC pensions. 

Percentage of benefits

Source: GEMINI/PENSIM.

Pension benefit quintiles

0

10

20

30

40

50

60

70

Fourth Top 20%

quintile

Third

quintile

Second

quintile

Bottom 20%

Percentage of benefits

Married at age 62

Single at age 62

Social Security benefit quintiles

0

10

20

30

40

50

60

70

Fourth Top 20%

quintile

Third

quintile

Second

quintile

Bottom 20%
Appendix II: Alternative Scenarios 

Page 67 GAO-03-429 Retirement Income 

Figure 28: Median Monthly Household Retirement Income at Age 62 by Pension 

Status for Generation X with Extension of Raised Pension Contribution Limits 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

extension of raised pension contribution limits, and constant rates of coverage over time for DB and 

DC pensions. 

0

1,000

2,000

3,000

4,000

5,000

Single at X Y Z

age 62

Married at

age 62

Median value in 2001 dollars

Household receives no pension benefits

Household receives pension benefits

Source: GEMINI/PENSIM.
Appendix II: Alternative Scenarios 

Page 68 GAO-03-429 Retirement Income 

Figure 29: Median Monthly Household Retirement Income at Age 62 by Educational 

Attainment for Generation X with Extension of Raised Pension Contribution Limits 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are reduced to funded levels, 

extension of raised pension contribution limits, and constant rates of coverage over time for DB and 

DC pensions. Educational attainment for married couples is defined as the attainment of the 

Generation X birth cohort member—the spouse may have attained a different level of education. 

Median value in 2001 dollars

Married at age 62

Single at age 62

Source: GEMINI/PENSIM.

0

1,000

2,000

3,000

4,000

5,000

Graduate

 degree

College

 graduate

Some

 college

High School

 graduate

High School

 dropout

0

1000

2000

3000

4000

5000

Graduate

 degree

College

 graduate

Some

 college

High School

 graduate

High School

 dropout
Appendix II: Alternative Scenarios 

Page 69 GAO-03-429 Retirement Income 

Figure 30: Median Monthly Retirement Income at Age 62 by Gender for Single 

Person Households for Generation X with Extension of Raised Pension 

Contribution Limits 

Note: Retirement income includes Social Security and pension benefits. Single individuals include 

those divorced, widowed, or never married at age 62. Simulations assume all workers retire 

completely at age 62, Social Security benefits are reduced to funded levels, extension of raised 

pension contribution limits, and constant rates of coverage over time for DB and DC pensions. 

Table 18: Median Monthly Household Retirement Income at Age 62 by Marital Status 

for Generation X with Extension of Raised Pension Contribution Limits, in 2001 

Dollars 

 Household income Income per household member 

Never Married $1,598 $1,598 

Married $3,912 $1,956 

Widowed $2,108 $2,108 

Divorced $1,403 $1,403 

Source: GEMINI/PENSIM. 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Simulations assume all workers retire completely at age 62, Social Security benefits are 

reduced to funded levels, extension of raised pension contribution limits, and constant rates of 

coverage over time for DB and DC pensions. 

Figures 31-35 and table 19 show the estimated distribution of retirement 

income for Generation X assuming scheduled Social Security benefits, no 

Median value in 2001 dollars

Source: GEMINI/PENSIM.

0

500

1,000

1,500

2,000

2,500

Single V W X Y Z

female

Single

male
Appendix II: Alternative Scenarios 

Page 70 GAO-03-429 Retirement Income 

extension of raised pension contribution limits beyond 2010, and a 

constant rate of DB and DC pension coverage over time. 

Figure 31: Proportion of Household Retirement Income for Each Quintile of the 

Retirement Income Distribution at Age 62 for Generation X with Scheduled Social 

Security Benefits 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are paid as scheduled under 

current law, no extension of raised pension contribution limits, and constant rates of coverage over 

time for DB and DC pensions. 

0

10

20

30

40

50

60

70

Bottom 20% Second quintile Third quintile Fourth quintile Top 20%

Percentage of income

Married at age 62

Single at age 62

Source: GEMINI/PENSIM.

Retirement income quintiles
Appendix II: Alternative Scenarios 

Page 71 GAO-03-429 Retirement Income 

Figure 32: Proportion of Household Pension Benefits and Household Social Security Benefits for Each Quintile of the Pension 

Benefit and Social Security Benefit Distributions at Age 62 for Generation X with Scheduled Social Security Benefits 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are paid as scheduled under 

current law, no extension of raised pension contribution limits, and constant rates of coverage over 

time for DB and DC pensions. 

Percentage of benefits

Source: GEMINI/PENSIM.

Pension benefit quintiles

0

10

20

30

40

50

60

70

Fourth Top 20%

quintile

Third

quintile

Second

quintile

Bottom 20%

Percentage of benefits

Married at age 62

Single at age 62

Social Security benefit quintiles

0

10

20

30

40

50

60

70

Fourth Top 20%

quintile

Third

quintile

Second

quintile

Bottom 20%
Appendix II: Alternative Scenarios 

Page 72 GAO-03-429 Retirement Income 

Figure 33: Median Monthly Household Retirement Income at Age 62 by Pension 

Status for Generation X with Scheduled Social Security Benefits 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are paid as scheduled under 

current law, no extension of raised pension contribution limits, and constant rates of coverage over 

time for DB and DC pensions. 

0

1,000

2,000

3,000

4,000

5,000

Single at X Y Z

age 62

Married at

age 62

Median value in 2001 dollars

Household receives no pension benefits

Household receives pension benefits

Source: GEMINI/PENSIM.
Appendix II: Alternative Scenarios 

Page 73 GAO-03-429 Retirement Income 

Figure 34: Median Monthly Household Retirement Income at Age 62 by Educational 

Attainment for Generation X with Scheduled Social Security Benefits 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Single individuals include those divorced, widowed, or never married at age 62. Simulations 

assume all workers retire completely at age 62, Social Security benefits are paid as scheduled under 

current law, no extension of raised pension contribution limits, and constant rates of coverage over 

time for DB and DC pensions. Educational attainment for married couples is defined as the 

attainment of the Baby Boom cohort member—the spouse may have attained a different level of 

education. 

Median value in 2001 dollars

Married at age 62

Single at age 62

Source: GEMINI/PENSIM.

0

1,000

2,000

3,000

4,000

5,000

Graduate

 degree

College

 graduate

Some

 college

High School

 graduate

High School

 dropout

0

1000

2000

3000

4000

5000

Graduate

 degree

College

 graduate

Some

 college

High School

 graduate

High School

 dropout
Appendix II: Alternative Scenarios 

Page 74 GAO-03-429 Retirement Income 

Figure 35: Median Monthly Retirement Income at Age 62 by Gender for Generation 

X for Single Person Households with Scheduled Social Security Benefits 

Note: Retirement income includes Social Security and pension benefits. Single individuals include 

those divorced, widowed, or never married at age 62. Simulations assume all workers retire 

completely at age 62, Social Security benefits are paid as scheduled under current law, no extension 

of raised pension contribution limits, and constant rates of coverage over time for DB and DC 

pensions. 

Table 19: Median Monthly Household Retirement Income at Age 62 by Marital Status 

for Generation X with Scheduled Social Security Benefits, in 2001 Dollars 

 Household income Income per household member 

Never Married $1,810 $1,810 

Married $4,190 $2,095 

Widowed $2,306 $2,306 

Divorced $1,622 $1,622 

Source: GEMINI/PENSIM. 

Note: Retirement income includes Social Security benefits, pension benefits, and earnings of younger 

spouses. Simulations assume all workers retire completely at age 62, Social Security benefits are 

paid as scheduled under current law, no extension of raised pension contribution limits, and constant 

rates of coverage over time for DB and DC pensions 

Median value in 2001 dollars

Source: GEMINI/PENSIM.

0

500

1,000

1,500

2,000

2,500

Single V W X Y Z

female

Single

male
Appendix III: GAO Contacts and Staff 

Acknowledgments 

Page 75 GAO-03-429 Retirement Income 

Alicia Puente Cackley (202) 512-7022 

Barbara Smith (202) 512-3651 

In addition to those named above, the following individuals made 

significant contributions to this report: Michael J. Collins, Gordon Mermin, 

Janice Peterson, Brendan Cushing-Daniels, Barbara Alsip and Patrick 

DiBattista, Education, Workforce, and Income Security Issues; Grant 

Mallie, Applied Research and Methods; and Marylynn Sergent, Strategic 

Issues. 

Appendix III: GAO Contacts and Staff 

Acknowledgments 

GAO Contacts 

Staff 

Acknowledgments 
Related GAO Products 

Page 76 GAO-03-429 Retirement Income 

Social Security Reform: Analysis of Reform Models Developed by the 

President’s Commission to Strengthen Social Security. GAO-03-310. 

Washington, D.C.: January 15, 2003. 

Social Security: Analysis of Issues and Selected Reform Proposals. 

GAO-03-376T. Washington, D.C.: January 15, 2003. 

Private Pensions: Participants Need Information on the Risks of 

Investing in Employer Securities and the Benefits of Diversification. 

GAO-02-943. Washington, D.C.: September 6, 2002. 

Private Pensions: Improving worker Coverage and Benefits. GAO-02-225. 

Washington, D.C.: April 9, 2002. 

Private Pensions: Key Issues to Consider Following the Enron Collapse.

GAO-02-480T. Washington, D.C.: February 27, 2002. 

Social Security: Program’s Role in Helping Ensure Income Adequacy. 

GAO-02-62. Washington, D.C.: November 30, 2001. 

Private Pensions: Issues of Coverage and Increasing Contribution 

Limits for Defined Contribution Plans. GAO-01-846. Washington, D.C.: 

September 17, 2001. 

Retirement Savings: Opportunities to Improve DOL’s SAVER Act 

Campaign. GAO-01-634. Washington, D.C.: June 26, 2001. 

National Saving: Answers to Key Questions. GAO-01-591SP. Washington 

D.C.: June 1, 2001. 

Cash Balance Plans: Implications for Retirement Income. 

GAO/HEHS-00-207. Washington, D.C.: September 29, 2000. 

Private Pensions: Implications of Conversions to Cash Balance Plans. 

GAO/HEHS-00-185. Washington, D.C.: September 29, 2000. 

Social Security Reform: Implications for Private Pensions. 

GAO/HEHS-00-187. Washington, D.C.: September 14, 2000. 

Pension Plans: Characteristics of Persons in the Labor Force Without 

Pension Coverage. GAO/HEHS-00-131. Washington, D.C.: August 22, 2000. 

Related GAO Products 
Related GAO Products 

Page 77 GAO-03-429 Retirement Income 

Social Security: Evaluating Reform Proposals. GAO/AIMD/HEHS-00-29. 

Washington, D.C.: November 4, 1999. 

Integrating Pensions and Social Security: Trends Since 1986 Tax Law 

Changes. GAO/HEHS-98-191R. Washington, D.C.: July 6, 1998. 

Social Security: Different Approaches for Addressing Program Solvency. 

GAO/HEHS-98-33. Washington, D.C.: July 22, 1998. 

401(k) Pension Plans: Loan Provisions Enhance Participation But May 

Affect Income Security for Some. GAO/HEHS-98-5. Washington, D.C.: 

October 1, 1997. 

Retirement Income: Implications of Demographic Trends for Social 

Security and Pension Reform. GAO/HEHS-97-81. Washington, D.C.: July 

11, 1997. 

(130130) 
The General Accounting Office, the audit, evaluation and investigative arm of 

Congress, exists to support Congress in meeting its constitutional responsibilities 

and to help improve the performance and accountability of the federal 

government for the American people. GAO examines the use of public funds; 

evaluates federal programs and policies; and provides analyses, 

recommendations, and other assistance to help Congress make informed 

oversight, policy, and funding decisions. GAO’s commitment to good government 

is reflected in its core values of accountability, integrity, and reliability. 

The fastest and easiest way to obtain copies of GAO documents at no cost is 

through the Internet. GAO’s Web site (www.gao.gov) contains abstracts and fulltext files of current reports and testimony and an expanding archive of older 

products. The Web site features a search engine to help you locate documents 

using key words and phrases. You can print these documents in their entirety, 

including charts and other graphics. 

Each day, GAO issues a list of newly released reports, testimony, and 

correspondence. GAO posts this list, known as “Today’s Reports,” on its Web site 

daily. The list contains links to the full-text document files. To have GAO e-mail 

this list to you every afternoon, go to www.gao.gov and select “Subscribe to daily 

E-mail alert for newly released products” under the GAO Reports heading. 

The first copy of each printed report is free. Additional copies are $2 each. A 

check or money order should be made out to the Superintendent of Documents. 

GAO also accepts VISA and Mastercard. Orders for 100 or more copies mailed to a 

single address are discounted 25 percent. Orders should be sent to: 

U.S. General Accounting Office 

441 G Street NW, Room LM 

Washington, D.C. 20548 

To order by Phone: Voice: (202) 512-6000 

TDD: (202) 512-2537 

Fax: (202) 512-6061 

Contact: 

Web site: www.gao.gov/fraudnet/fraudnet.htm 

E-mail: fraudnet@gao.gov

Automated answering system: (800) 424-5454 or (202) 512-7470 

Jeff Nelligan, managing director, NelliganJ@gao.gov (202) 512-4800 

U.S. General Accounting Office, 441 G Street NW, Room 7149 

Washington, D.C. 20548 

GAO’s Mission 

Obtaining Copies of 

GAO Reports and 

Testimony 

Order by Mail or Phone 

To Report Fraud, 

Waste, and Abuse in 

Federal Programs 

Public Affairs