Retirement Saving and Long-Term Care Needs: An Overview

Introduction

The nation is aging: The elderly population is expected to more than double by 2030. Yet many households — likely to be somewhere between one-quarter and one-half — are not saving adequately for income and health care needs during retirement. One of the difficult challenges in saving for retirement is the substantial uncertainty associated with long-term care, which can impose massive costs on those who have not insured against the risk. This overview paper documents trends affecting financial security during retirement; examines the financing of long-term care; and then explores the role of pension saving in preparing for financial needs, including long-term care.