The Fiscal Implications of Inadequate Retirement Savings in Maine

This study estimates the future costs to taxpayers from new retirees in Maine and in the United States as a whole (and there are unreported estimates for each of the other 49 states). As in previous reports of this type,2 “new retirees” refers to people turning age 65 in coming years. The projections are for the 15 years from 2018 through 2032. Inadequate savings for retirement creates fiscal costs due to increased elderly reliance on public assistance (mostly in Medicaid, Supplemental Security Income, Supplemental Nutrition Assistance Program, and housing assistance). An aging workforce moving into retirement is increasing public-assistance spending on the elderly. Moreover, savings for retirement has been declining in recent years, which will further exacerbate the problem. But the fiscal burden from the retirement-age population does not have to grow. Simulations show that increasing retirement income through greater preretirement savings can substantially reduce the need for taxpayer contributions for public assistanc