The Baby Boomers Retirement Blog

Almost everybody needs a digital pension. What the heck is a “digital pension”? – you may ask and you are right in doing so.

Let me remind you that we live in a digital era. The Digital Revolution meant the end of the Industrial Age and the beginning of the Computer Age or Information Era. Nowadays, many people tend to think of the Information Age or Digital Era in terms of cell phones, digital music, high definition television, digital cameras, email on the Internet, the Web, and other relatively new products and services that have come into widespread use. The pace of change brought on by such technology has been very rapid.

One of the biggest changes that influenced our lives was the invention of the World Wide Web in 1989. Today the Internet has become the ultimate place to accelerate the flow of relevant information and the fastest growing form of media.

As I wrote in my Report (the Baby Boomer Pension Crunch) I realized that the retirement income of the Baby Boomers is in danger and that we have, no, we MUST do something about it to secure a dignified retirement. In this “digital era” the only way to achieve this is to use the most advanced technology: the computer and the internet.

As I see it, the only escape from the miserable situation we have created for ourselves is to go ahead and turn to the technology of the future. We have to use the digital products and services to create the digital pension for ourselves.

That’s how I coined the term “digital pension”.

And now back to the original question: who needs it?

See the numbers below and answer the question for yourself.

Average retirement savings

• The typical pre-retiree household (age 55 and up) has a retirement savings of $60,000.
• Baby boomers between the ages of 41 and 54 have typically a retirement savings of $30,000.
• Baby boomers who save in a 401k have an average 401k account balance of $80,000.

For how many years would those savings last when they start withdrawing money from them?

OK, but what about the “government pension” (Social Security retirement income)?

Quote from their website:
The amount for 2009 for a person retiring at full retirement age (66) is $2,323. This is based on earnings at the maximum taxable amount for every year after age 21.

To give you an idea about the maximum taxable amount, take a look at this graph:
It is for somebody born in 1951, who started to work at age 24 (after going to college) in 1975 and earning every year since then at least the maximum taxable amount:

If you put in the calculator that for the coming years until the retirement (in 2017 at age 66) the individual will earn the same $102,000 amount per year – the retirement benefit would be $2,261.00 per month. A little bit more than two grands. Compare this to the present income: $102,000 per year means $8,500/month.

Can you imagine the drastic change in lifestyle when you have to go from eight grands a month to two grands? Do you think you can downsize your life to that extent? Yes, I am aware that we might need a little bit less for the retirement years, let’s say 70 or 75% of the active income. That still would be around $6,000-6,500…

Don’t forget, if you didn’t always earn the maximum taxable income during your active years – your benefit will be way less!

So, do you need the digital pension?
Keep the answer for yourself and download my free report to learn more.

About the author

Istvan Horvath is an author, blogger, former journalist, a passionate advocate of the Baby Boomers, and the founder of DigitalPensionCom. He is writing extensively about the Baby Boomers' retirement and pension issues. His Pension Report is an eye-opener. Visit his Baby Boomer Pension Blog for more articles. This article can be reprinted or republished provided the content and links are left intact, and the "about the author" section is included.