Many Americans are anxious as they contemplate retirement. While we might hope with optimism, reality paints a gloomy picture.  The average Social Security retirement benefit is $1,301 per month, basically the poverty level, and it is too small for a comfortable retirement.

Relatively few Americans will retire with an employer pension, and some pension promises may not be fulfilled. Most Americans have not done their part by saving enough in CDs, brokerage accounts, bank savings accounts, 401(k)s and IRAs.  Indeed many retirees are realizing they must continue working and/or accept means-tested entitlements such as food stamps and housing assistance.

Overall, median income between 2010 and 2013 fell from $49,000 to $46,700. The middle-class was hit hardest.  The second and third family income quintiles saw declines of 7 percent and 6 percent respectively, and annual inflation ran at 2% making the income declines even more abrasive for most Americans.  This widely experienced contraction in spending power explains why decline in unemployment rates ignite so little consumer cheer.

Like declining income, the story on national wealth is not much different. For most families, wealth is dominated by the equity in their home and by the balances in 401(k)s and IRAs.  The 2008 bust in home prices hit the middle-class severely.  In the 2010 to 2013 period, families in the second and third quintiles saw wealth declines of 10% and 17% respectively. Overall, families’ median net worth fell 2% to $81,200, but mean net worth was unchanged at $534,600.  That mismatch reflects the top decile’s ability to harvest large gains from the stock market recovery, which in turn increased the average wealth.

Americans approaching retirement (aged 55 to 64), had a 2013 median net worth of $165,900. Probably-retired Americans (aged 65 to 74), had a 2013 median net worth of $232,100.  By liquidating their assets and annuitizing the proceeds at about 6%, these families could cobble income supplements of $10,000 to $14,000. None of the median-situated families near of at retirement have saved enough to produce retirement comfort.

About 68% of prime-age (age 35 to 64) employee families participate in pensions – that is, employer plans for a defined benefits, defined contribution or employer-contributing IRA. Only 40% of those in the lower half of incomes participate in these plans and their median balance for their defined contribution plan and IRAs was $39,100 in 2013.  In contrast, the upper-middle income group (percentiles 50 through 89.9) held a median balance valued at $147,300.

Pensions are promises, not certainties. For private sector defined benefit pensions, the Pension Benefit Guarantee Corporation (PBGC) “insures” private sector employees up to a statutory limit. In the case of multiemployer pension plans that cover 10 million people, PBGC says its fund will run dry within 10 to 15 years.

Some public employees working for cities have already experienced pension or retirement benefit defaults (e.g. Stockton, California and Detroit, Michigan). Courts have ruled Stockton’s pension obligations can be “renegotiated” during bankruptcy.  On the other hand, Rhode Island’s overturn of its public employee pension obligation is the subject of interminable politics and legal wrangling. Moody’s estimates that public employee pensions are about 2 trillion dollars underfunded. State and local politicians over-promised public employee pensions and set aside too little funding to cover the liabilities they created.

The number of those working after normal retirement age is increasing quickly. In September 2014, 2010, and 2004 there were 8 million, 6.4 million and 5 million workers of age 65 and older.  For some it may be a joy, but for many it is a necessity.

Most Americans have saved too little for retirement. One of the few viable options for retirement income is to work long after retirement.  Social Security is helpful, but it is often frittered away on too-easy-to-get disability payments.  When Congress and the White House get beyond their self-indulgent partisan tantrums, a fiscally sane approach to improving retirement income will be one of the highest priorities for them to address.

Alan Daley is a retired businessman who writes for The American Consumer Institute Center for Citizen Research