Around 10,000 people are turning 65 every day, and more than half of them can’t afford to comfortably retire. In fact, about a quarter of Americans over age 65 have yet to retire, or have returned to work for financial reasons. No matter why more seniors are working now than ever, the retirement crisis looms large over all American workers.
Seniors in the workforce
According to the Bureau of Labor Statistics, seniors will be the fastest growing demographic to enter (or re-enter) the workforce in coming years. This statistic is partially due to how many people are aging into retirement age every day. However, it also speaks to how financially dire the retirement crisis has become for American seniors.
On average, baby boomers have a median savings of $150,000 to get them through retirement, according to the Transamerica Center for Retirement Studies. But with America having one of the greatest wealth inequalities in the developed world, seniors are suffering along with their adult children. Around 50 percent of seniors are reaching into their meager retirement funds to pitch in and help their adult children and grandchildren get by.
Nearly a quarter of American workers of all ages don’t think they’ll ever retire due to financial factors.
Previous means of retiring
The days of pension security are long gone. During this time, you worked for a company for many years, and the company would pay you a stipend (the amount of which depended upon your salary and years worked) during your retirement years.
In fact, most private-sector employers don’t offer any type of retirement plan. This is one reason why a quarter of all retirees depend upon Social Security to provide at least 90 percent of their retirement income.
Most retirement funds are now 401(k) accounts where employees and employers pay into an account, and the money is invested in the stock market. However, this type of retirement plan backfired enormously during the Great Recession circa 2007. During this time, 401(k) accounts lost one-third of their value, financially devastating many of today’s seniors and speeding up the retirement crisis.
Other reasons seniors work
According to an AARP survey, seniors continue to work or return to work because they:
- Need the money
- Want to save more for retirement
- Enjoy their jobs
- Like feeling useful and staying busy
- Need the health insurance
- Like interacting with people
When people stop working for money, they often start working for a cause, like giving back to their community. Volunteering is good for the community as well as the person volunteering, if they are financially able to do so.
Volunteering can provide people with a sense of purpose, which can contribute to a longer lifespan and decreased risk of neurodegenerative diseases like Alzheimer’s and dementia. According to the Corporation for National and Community Service, seniors who volunteer also contribute more than $73 billion of economic value to their communities.
To find opportunities to volunteer in your community, visit VolunteerMatch.
Gutting Social Security
Social Security is paramount to most American seniors. The Trump administration is taking great strides to gut the program in order to pay for the Tax Cuts and Jobs Act of 2017, which ballooned the national debt to $22 trillion.
However, Social Security is a self-sustaining social program which by law cannot raise or lower the national debt.
If you are concerned with your Social Security income being gutted, research which political candidates are advocating to slash benefits up to 23 percent. You can find this information by visiting educational, nonpartisan resources like HeadCount.org or Countable.us.