This Friday at 9 pm EST and midnight, CNBC will air a special, "Boomer Angst," on the difficulties the baby boomers are facing in their retirement. We did a similar special a year and a half ago, and the facts have not improved since then.

The Center for Retirement Research (CRRS) at Boston College, in a paper published in August, 2007, noted that:

--Nearly 45 percent of households are "at risk" of not having enough to maintain their living standards in retirement, even if they retire at 65;
--The median balance for household heads approaching retirement is only $60,000 (!)

What accounts for this declining prosperity? There are three legs to retirement: Social Security, personal savings such as a 401(k) plan, and a pension or defined benefit plan.

But there are cracks everywhere: Social Security is increasingly strained, and there are clear problems with pensions and 401(k)s.

One major problem is that the percentage of households with pensions are declining. The CRRS study noted that in 1992 most households age 51-61 were covered by a pension (defined benefit plan). By 2004, 35 percent of households in this age group with pension coverage were covered by a 401(k) plan only; in other words, an increasing number of households have no pension, just a 401(k) or similar instrument.

Well, people could make up that loss by putting more in their personal retirement programs, couldn't they? Theoretically, yes, but they appear not to be doing so; many do not fully fund their plans and participation rates are actually dropping. The CRRS report noted that benefits projected from 401(k)s are smaller than those projected from defined benefit plans.

Baby boomers are facing other headwinds as well:

--Lower interest rates, which cut into fixed income;
--Longer lifespans than their parents, which require more overall retirement wealth;
--Rapidly increasing health care costs could substantially increase the number of households "at risk";
--Housing wealth, a substantial part of household wealth in the past, is much lower than in previous decades, thanks to recent shrinkage in home values and a notable rise in mortgage debt. This means that some households will be facing mortgage payments during retirement.

The conclusion of the CRRS study: "Yes, there really is a retirement savings crisis." Americans need to save more and work longer.

Here is the full Boston College paper on retirement, "Is There Really A Retirement Savings Crisis?"

Questions?  Comments?