This model analyzes how unemployment risk, aging, and retirement affect consumption and monetary policy transmission. Agents save due to expected income drops at retirement, wage changes over their careers, and the possibility of unemployment. Retirement policies significantly alter asset distribution, impacting the young's ability to insure against unemployment. Surprisingly, increased retirement benefits can boost consumption during unemployment, despite higher taxes reducing unemployment benefits. This occurs because the middle-aged save less, making more assets available to the young. Interest rate reductions disproportionately affect individuals based on their labor market prospects and saving behavior. Monetary policy expansions are amplified by incomplete insurance markets because they lead to reduced precautionary savings. The degree of market incompleteness is endogenous, influenced by asset holdings across age groups. These asset holdings are shaped by retirement policies, government bond supply, and wage profiles. Therefore, understanding asset distribution across age cohorts is crucial for both consumption patterns and business cycle dynamics.