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When the weather's good, Ed Beltram heads to the golf course near his Colorado home almost every day. Most of the time, though, he isn't there to play a round. Instead, the 59-year-old retiree is scheduling tee times for others, washing golf carts and manning the counter in the pro shop. The $7.50-an-hour job has some perks: As an employee, Beltram gets to golf for free, a $45 savings every time he hits the links. Still, it's a job. And after 31 years of working at one company to earn what he thought would be a comfortable retirement, he never expected to be punching a clock.It isn't what Sherry Beltram, 57, envisioned either. "It's so disappointing that he even had to consider going back to work," she says. Unfortunately, neither she nor Ed saw any choice -- not after his 401(k) lost $250,000 in what felt like a flash, and the company he'd worked for almost his entire adult life suddenly stopped subsidizing the couple's health insurance premiums.
It seems everywhere she looks, Sherry Beltram -- without an income or pension of her own and still several years from tapping Social Security -- runs up against a daunting new reality. Her husband washing golf carts instead of driving them. Her 81-year-old father watching his employer of 43 years drop the death benefit that was to help support his wife if he left her a widow. Her 33-year-old son moving from job to job over the first ten years of his career in the high-tech sector, unable to save a dime.
For millions of current retirees -- and for the 78 million baby boomers who will eventually stop working -- retirement has become almost a fantasy, not a life stage you plan for. One example: More and more private companies can't meet their obligations to those aging out of the workforce. In 2003, 155 underfunded private pension plans were taken over by the federal Pension Benefit Guaranty Corporation (PBGC). In 2004 that number rose to 192. The surge is threatening the safety net for those who thought they had rock-solid benefits coming. For those who've never had traditional pensions to count on, shrinking 401(k)s and the issue of Social Security's long-term solvency make for an even bleaker outlook.
"We worry about my parents and we worry about our kids," Sherry Beltram says. "Will we be able to help them out if they need it?"
Ed Beltram still draws a decent monthly pension, but he and other retirees have begun to question how much security they've got. And why not? They've seen the foundation they thought they'd built for their later years being chipped away. They worry about Social Security's prospects. They feel betrayed by changes to retiree health care coverage. They fear ex-employers may go bankrupt or merge with less-friendly companies, putting their pensions at risk. They read about new accounting rules that could make it harder for companies to meet their pension obligations in the future. And they worry that the PBGC may not be able to keep up with the demand.
Three years ago, Ed Beltram retired from Lucent Technologies, a communications company spun off from AT&T in 1996. Beltram had been with AT&T and Lucent nearly his entire career, mostly in Oklahoma City as a human-resources manager in a factory making telecommunications switching gear.
In its first years, Lucent was a Wall Street darling. Its stock kept climbing, making plenty of investors rich and fattening the 401(k)s of many employees -- Beltram included. By 1998, he and his wife, reassured by their healthy nest egg, took the first steps in their retirement plan.
They'd always dreamed of living in the mountains, so Beltram took a job in Lucent's Denver office and the couple built a home in Woodland Park, about 25 miles from Colorado Springs. The three-bedroom ranch house sits high in the hills, surrounded by pine trees, with a view of Pikes Peak. The $650 mortgage payment is a lot more than the $151 they'd been paying on their Oklahoma City house, but between the pension they'd be receiving and their 401(k) savings, they didn't think they'd be stretched too thin.
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