Boomers will need to work extra two years

New research from Hewitt Associates found a typical 55-year-old worker who saves 10 percent of his or her income in a 401(k) will need to save an extra 12 percent for the next 10 years to replace savings lost in 2008, or work an extra two years. Even if boomers can get back what they lost in the downturn, they're still expected to fall short of recommended retirement income levels.

"Most Americans were already far from achieving adequate levels of retirement income before the economy collapsed, and for many, the financial downfall has made reaching these goals nearly impossible," explains Rob Reiskytl, Hewitt's leader of Retirement Plan Strategy and Design.

"[T]he key for workers is to keep saving, and to make sure they are using all the tools and resources they have at their disposal to maximize their retirement savings potential. It also means that many employees — particularly Baby Boomers — may have to make some tough decisions about what retirement looks like. They may need to work longer, part-time, or find other ways to supplement income in retirement to make up for the shortfall."