The 100 largest CEO retirement accounts are worth the same amount as the retirement savings of 41 percent of U.S. families, or more than 116 million people, according to a study released Wednesday by the Center for Effective Government and the Institute for Policy Studies.
The study, titled "A Tale of Two Cities," found that 100 Fortune 500 chief executives have retirement assets collectively worth $4.9 billion, or about equal to the amount saved by 50 million U.S. families.
On average, the CEO accounts are worth more than $49.3 million, which would produce a $277,686 retirement check every month for life, according to the report. That's compared to 31 percent of the bottom economic group of U.S. families who have nothing saved for retirement, noted USA Today.
The gap between CEO retirement savings and those of average U.S. workers is even bigger than the gap between the pay of average workers and CEOs, according to the report.
"This CEO-to-worker retirement gap is a lot bigger than the pay gap and one more indicator of the extreme level of inequality that is really tearing the country apart," said Sarah Anderson, the report's co-author and the global economy project director at the Institute for Policy Studies, according to Bloomberg.
At the top of the list is David C. Novak, the recently departed CEO of Yum! Brands Inc., who has a total retirement savings of $234.2 million, mainly consisting of performance bonuses he directed into Yum shares. The stock saw a 900 percent appreciation under his leadership and resulted in a more than 1,100 percent shareholder return. With those kinds of retirement savings, Novak can expect to see monthly payments of $1.3 milion for the rest of his life, reported the Guardian.
Scott Klinger, director at the Center for Effective Government, said that the massive nest eggs aren't usually the result of extraordinary performance, but rather, "They are the result of rules intentionally tipped to reward those already on the highest rungs of the ladder," reported Common Dreams.
"Fortune 500 CEOs have $3.2 billion in special tax-deferred compensation accounts that are exempt from the annual contribution limits imposed" on the 401(k) retirement accounts of normal workers, according to the study.
"In 2014, these CEOs saved $78 million on their tax bills by putting $197 million more in these tax-deferred accounts than they could have if they were subject to the same rules as other workers. These special accounts grow tax-free until the executives retire and begin to withdraw the funds."
