Retirement Planning: Why Working Longer May Not Work

Based on a recent survey by The NHP Foundation, a not-for-profit provider of affordable housing, 73% of non-retired Americans aged 50 and older want to delay retirement. We’ll get to that word “want” shortly, but let’s first discuss some reasons why working longer may not be the solution to retirement savings problems.

A study from the Transamerica Center for Retirement Studies reveals all sorts of wishful thinking by Baby Boomers. Here are a few of the biggest whoppers TCRS found this group is telling itself:

  • 72% of workers say their current employer is supportive of its employees working past 65, while statistics regarding the age of the active labor force show a very steep decline after age 65. In fact, last year only 20% of Americans 65 and older were actively employed either full- or part-time.
  • 47% expect they will have a phased transition into retirement, working fewer hours than they do now, possibly doing less demanding work. Wouldn’t that be great? Sadly, a Society for Human Resource Management study found only 5% of employers offer a formal phased retirement program.
  • 68% of Baby Boomers think they will stay with their current employer past age 65 working part time until they are ready to retire, even though few employers offer the ability to shift into part-time work.
  • Let’s keep our trip to Fantasy Land going. An amazing 60% of workers believe when they shift from full- to part-time work at their current employer they’ll receive the same level of employee benefits. Whereas TCRS President, Catherine Collinson flatly states, “We know for a fact that employers often exclude part-time workers from certain benefits packages.”

How confident are Boomers that their “plan” will work out? Apparently very confident, since only 4% are continuing their education and 14% are proactively networking to meet new people who might provide employment opportunities.

The bottom line of all these facts and figures is this: Baby Boomers expecting to work past normal retirement age have conveniently neglected to remember that employers have the final say. And apparently those bosses aren’t planning to hang on to older, slower, tired workers at the top of their pay scale.

Which brings us to another important issue. Even if your employer is willing to keep you around, will you be able to answer the bell healthwise? Not according to a 2016 United Health Foundation study of the health of senior Americans. That study found that Boomers are entering their senior years with “higher rates of obesity and diabetes and lower rates of very good or excellent health status.”

According to the Centers for Disease Control, people ages 65-74 were diagnosed with type 2 diabetes 13 times as often as people age 45 or younger! Add increased risk for coronary disease, cancer, depression, eye problems, Alzheimer’s, joint replacement, and osteoporosis to the list and it’s clear that many Baby Boomers simply aren’t going to be up for the challenge of continuing to grind out additional years of work.

Now let’s talk about Boomers supposedly “wanting” to continue working past age 65. When we were in our 20’s we all said to ourselves, “I’m going to retire when I’m ___!” Whatever that number was, it definitely did not start with a 7. And probably not even with a 6.

No, we dreamed of working hard and retiring early, right? Trouble is, many forgot to save enough money along the way. Or, as happened to us, calamity struck and savings were wiped out.

So here you find yourself, short on savings and running out of time. Planning to work as many extra years as you can although employers and your own health say that very well may not happen. Even telling yourself you want to keep working until you’re too old, too tired, and maybe too sick to enjoy the few years you have left.

Come on. No you don’t. The truth is you wish you could have already quit. You’re at an age where it’s high time you start living your life based on what you want to do. Not what you think you have to do.

You’ve been doing what you have to do long enough. Change your thinking and challenge yourself to find a solution to retire NOW. With the money you have.

For us the solution was moving abroad to a country with a lower cost of living. We’ve been enjoying an abundant lifestyle for years funded solely by our Social Security income. Maybe that’s the answer for you too.

Be open to all possibilities. And don’t you dare settle. You deserve better.

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    1. Edd & Cynthia

      Of course it’s a personal decision, and we’re making no attempt to tell anyone what to do. Not sure what your point is.

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