Broken piggy bank © Hemera Technologies,, Jupiterimages

In late 2012, Federal Reserve Chairman Ben Bernanke fessed up and revealed the worst-kept secret in finance: The low rates the Fed has maintained in an attempt to ignite the U.S. economy are badly hurting retirees and others who rely on fixed income.

"My colleagues and I know that people who rely on investments that pay a fixed interest rate, such as certificates of deposit, are receiving very low returns, a situation that has involved significant hardship for some," Bernanke said in an October speech in Indianapolis.

Such sympathy is probably small consolation to millions of Americans who saved diligently over the years but now find themselves struggling, thanks to rates that have remained near zero percent for more than four years.

"Our firm has long been of the belief that artificially low interest rates have punished savers and retirees," says Samuel Scott, president at Sunrise Advisors in Leawood, Kan.

"We heard someone say that the 'haircut' to depositors by Cypriot banks pales in comparison to the 'theft' by Bernanke and the Fed from savers."

How does Fed policy hurt retirees? Bankrate counts six ways.

1. Paltry returns on savings

In June 2006, the federal funds rate stood at 5.25%. At the Federal Reserve's meeting in September 2007, it began lowering the federal funds rate and continued to do so until it fell to a range of between zero and 0.25% in December 2008. It remains there today.

Rates on certificates of deposit, money market accounts and savings have plunged in tandem.

The result has been devastating for retirees counting on safe, fixed returns, says Michael Rubin, founder of Total Candor, a financial planning education firm based in Portsmouth, N.H.

"They're earning a lot less on their savings than any other time in recent history," says Rubin, author of "Beyond Paycheck to Paycheck."

Despite such low returns, CDs and other savings vehicles still have a place in a retiree's portfolio. Even getting a sad-sack 1% return is better than exposing all your savings to higher levels of risk, says Alan Moore, founder of Serenity Financial Consulting in Milwaukee.

"I look at cash as market insurance," he says. "When the stock market takes a dive, [retirees] don't want to be in the position of having to sell stocks to fund their lifestyle."

2. Low rates on fixed annuities

Many retirees buy an annuity in hopes of getting a safe stream of income. Low rates undercut that strategy, Moore says.

"The problem is that the monthly income a client receives from their fixed annuity is based on interest rates at the time they purchase the annuity," he says. "With interest rates at all-time lows, annuity payouts are also at all-time lows."

Nathan Kubik, a Certified Investment Management Analyst at Carnick & Kubik, which has offices in Denver and Colorado Springs, Colo., agrees that now is among the worst times to buy an annuity.

"Locking in these historically low rates right now through fixed-rate annuities is the height of folly," Kubik says.

Kubik suggests talking to a fee-only adviser who is an expert in fixed-income investments. Such a pro can suggest alternatives to annuities.

Meanwhile, Moore urges investors to avoid purchasing annuities until rates climb.

"Another option is to buy a smaller annuity today, such as 25% of what [investors] would normally buy," he says.

Doing this several times from different companies over a few years allows you to buy at various interest rates, he says. Plus, buying from separate companies protects you if one of the companies goes bankrupt.

3. Underfunded pension funds

Today's pension funds are in big trouble. Ninety-four percent of corporate defined benefit pensions were underfunded in 2012, according to a recent report by Wilshire Consulting.

Pension funds must make sure their assets grow at a pace adequate to cover future liabilities. The Wilshire report notes that today's low interest rates make this especially difficult to achieve.

"It is putting pressure on the already-weak pension system," Scott says.

But Rubin notes that pension woes are unlikely to affect large numbers of retirees. "Most retirees don't have pensions and will not be affected," he says.

He also believes that current pension recipients are unlikely to see their payout cut. But future retirees may not be as lucky, he says.

Moore agrees. "It is hard to know if clients can depend on them for their retirement income," he says. Workers who are worried about their company's pension plan must take action now. "They need to save more or work longer, as well as delay Social Security, to maximize the benefit they will receive."

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