My biggest concern is that I may outlive my retirement savings. Here's the good news though. There is a mechanism in place that balances all this out.
Lifespan vs. Retirement Savings
1. The worse my retirement savings do, the more stressed out I become. 2. The more stressed out I become, the shorter my lifespan will be. 3. The shorter my lifespan will be, the less retirement savings I will need. 4. The less retirement savings I will need, the less stressed out I become. 5. The less stressed out I become, the happier I will be!
As you can see, the worse my retirement savings do, the happier I will be.
I think you are right. I really should have worked for the Federal Budget Office. Hahaha!!! ;)
In all seriousness, since the 5-Year TIPS and 30-Year I-Bonds earn pretty much 0% over inflation now and the government will tax the inflationary gains, I think it is pretty much a given that my retirement savings will be doing very poorly if this continues.
It is becoming increasingly difficult to safely grow retirement savings. I factored that in starting in 2004. I cut my spending to match the new reality. Those who have yet to factor it in are going to end up being very disappointed.
Many retirement calculators still default to 8%. Good luck on that one with a mix of stocks and bonds long-term from these levels. For one thing, the days of making huge gains on bonds is coming to an end. In my opinion, you can't start with long-term rates at 4% and somehow end up earning anything close to 8%.