Older Americans delaying retirements

The average person spends 20 years in retirement.
Zillow
Aug 29, 2013

 

By S.E. Slack

There’s a cultural shift happening in America and older Americans are driving it. The average person spends 20 years in retirement but most probably won’t have enough money to purchase a home in a snowbird community like Phoenix.

As a result, nearly two-thirds of Americans between the ages of 45 and 60 are planning to delay their retirements past the traditional period of exiting the workforce in their early to mid-sixties, according to business research association The Conference Board.

While the term “retirement” once connoted a lifestyle free from the demands of work, it also indicated heavy reliance on personal savings and Social Security. But both of those are fading from the economic landscape.

Middle- and lower-income employees – regardless of age – are significantly more likely than upper-income ones to say they will continue working past retirement age out of necessity. Some, like Catherine Jones, a 66-year-old airline industry employee, doesn’t see retirement in the near future. Her corporate pension was chopped down by a bankruptcy court and the Social Security benefits she expected to supplement that pension during her retirement starting at age 67 won’ cover half of her bills.

“There’s no way I can live the way I expected to during retirement,” Jones said. “I’m really not sure how long I’ll have to continue working now.”

There is potentially a bright side, however. If Americans carry through on their intent to continue working, at least part time, after reaching retirement age then the entire image of retirement could change. While this can be a disappointment to some retirees, it could have benefits both socially and health-wise for Americans, according to polling firm Gallup.

Staying in the workforce keeps seniors more physically and mentally active than they would be otherwise. It would help them financially, particularly if the alternative is dependency on inadequate retirement savings and an uncertain Social Security system. Gallup explains that this could benefit the economy, with seniors contributing experienced labor as well as earning income that fuels consumer spending and, therefore, the economy as a whole.