BlackRock Inc. CEO Larry Fink’s annual letter to investors details issues he sees as key for investors, businesses and markets.
In this year’s edition, “Time to Rethink Retirement,” the billionaire focused on the need for the government and corporations to fix the looming retirement crisis.
Fink, who heads the largest asset manager in the world, criticized his own generation (Baby Boomers) for focusing on “their own financial well-being to the detriment of who comes next.” He cited the 2022 Census Bureau survey, which said about 50% of people in the US between 55 and 65 reported not having a single dollar saved in personal retirement accounts.
Fink said the “retirement crisis” is getting serious enough to evoke a national relief effort commensurate with that which addressed the 2008 mortgage crisis.
The businessman encouraged private companies to match employee 401(k) contributions and make it easier for workers to roll over retirement accounts when changing jobs.
Fink also highlighted the need for the U.S. and other countries to reconsider the concept of retirement and related public policies in light of increasing life expectancy.
“When people are regularly living past 90, what should the average retirement age be?” Fink asked rhetorically in the letter. But he noted it will be important to encourage people who want to work longer to be able to do so, rather than requiring it.
Conversations around bumping up the retirement age are cropping up more and more as the US approaches 2034, the year when the Social Security Administration says it will not be able to pay out full benefits unless Congress fixes the program.
“Young people have lost trust in older generations,” Fink wrote. “The burden is on us to get it back. And maybe investing for their long-term goals, including retirement, isn’t such a bad place to begin.”
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