THE NEW HOLISTIC RETIREMENT • 39 would contribute money to an employee’s qualified account, but it was up to the employee to grow that money and manage it so they’d have enough income to last a lifetime. We transitioned fro m a syste m of defined benefits (where a company provided you a set income amount) to a syste m of defined contributions (where a company provided you a set amount to save each year). It was a HUGE change. And it caught on. By 2017, only 13 percent of private- sector employees had a pension. 22 While public-sect or employees still often have pensions, many government pensions at the municipal, state, and feder al levels are underfunded. 23 Employers may have abandoned long game income for their workers , but those workers have n’t abandoned the need for stable , long-ter m retirement income. So now they had to find a different wa y t o get it. Witness th e bi rth o f th e annui ty . New Approach to Long-Game Income Much like pensions , annuities offer a way for savers to access annual income they can’t outlive. Essentially , yo u give an annuity company a portion of your savings, and, in return, they guarantee a set income you’ll receive in retirement each year—no matter how long you live. 22 Kathleen Elkins. CNBC. January 4, 2017. “ A Brief History of the 401(k), Whic h Change d How Americans Retire,” https://www.cnbc.com/2017/01/04/a-brief- history-of-the-401k-which-changed-how-americans-retire.html 23 PEW Charitable Trusts. June 11, 2020. “The State Pensi on Funding Gap: 2018.” hb rt ti pe fss: // 2/ w0 2w0w/ 0. p6e/wt ht re u- ssttast. oe r- pg e/ ne ns i/orne-sfeuanrdc ihn-ga-ngda-pa-n2a0l 1y s8i s / i s s u e -
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