Could we be saving too much for retirement?

I wonder what you would hear if you could talk to the ones who scrimped all their lives and died at 65. Thumper

This part of my post addressed exactly that, perhaps not the way you were thinking. Health is a variable, often a binary one, i.e. able to work or not. Most of the conversation here presumes that one can work until a retirement date of their own choosing. The woman whose story I cited above might have lived high on the hog for those 20 years and now found herself unable to buy groceries. (I understand your intent, though, one can save and at 62 find they are no longer fit to travel, and the bankroll is of little use to them.) There is no one 'right' answer to any of this, just some difficult choices along the way. JOE

An analysis which seems to ignore uncertainty about future income (due to changes in the economy, or personal health) and also liquidity costs of borrowing money (you borrow money at a higher rate than you can invest it, in an equally safe asset).

The old rules of thumb hold, I think. Most people need to avoid consumer debt (other than a 25 or 30 year mortgage), and to save at least 10% of their gross income towards retirement. Ideally 15% (including employer contribution towards pension).

I think the problem is we live in a society that rewards impatience, and makes it possible for us to borrow freely. There's endless research that shows human beings are not very good at deferring current pleasure for future gain.

so

This is so rare nowadays (except perhaps in the public sector, and there, there is more and more outsourcing of jobs to private contractors).

Even with the pension plan, a 401K, and SS I

The only thing you can say is that the DB plan and SS mean you can afford to take higher risks in the 401k eg by tilting towards small cap value funds (and my personal favourite at the moment) large cap value funds, and in general holding equities only in the 401k.

Define "swimming in it". Do you mean you won't have enough to cover expenses, or that you won't be able to live high on the hog?

Elizabeth Richardson