The new golden years? Work, work, and more work
During the economic crisis, some Americans worried that they'd never be able to retire. Now there's evidence that may be playing out, given that older workers are hitting 65 and increasingly staying in the labor market.
A record number of Americans over the age of 65 are working, according to data from the Bureau of Labor Statistics. A decade ago, about 5 million senior citizens continued to work, a number that had swelled to more than 9 million last month. In 1994, slightly more than 1 out of 10 senior citizens was still working. Now, about one out of five Americans over the age of 65 remains employed.
While some seniors are likely putting off retirement because they want to continue working, it's likely that the shift reflects the economic instability that Americans of all ages are experiencing. More than half of people over 50 years old say they plan to or already have worked past their 65th birthday, with the majority of those saying it's linked to financial reasons, according to survey published this month from The Associated Press‑NORC Center for Public Affairs Research.
The ranks of elderly workers are likely to only keep growing, given that about 10,000 baby boomers turn 65 years old each day, a trend that's projected to continue through 2029.
Yet many of those boomers are woefully unprepared for retirement, at least when it comes to their financial health. In an annual survey conducted by investment firm BlackRock, baby boomers said they wanted to have about $45,500 in annual retirement income, although the average boomer had only saved up enough to produce slightly more than $9,000 in annual income.
Of course, Generation X and the millennial generation aren't likely to be in any better shape. The typical Gen Xer has far fewer retirement assets as someone of the same age had 25 years earlier, according to a J.P. Morgan study. Millennials, many of whom are just starting their careers, are hobbled by increasingly high student debt loads as well as an uneven job market.
The share of seniors in the workforce will most certainly continue to rise, with the Bureau of Labor Statistics projecting that almost 22 percent of the 65-and-older set will be working in 2024.
Some Americans are working as long as they can because they find enjoyment and rewards in their efforts. But some policy makers and presidential candidates have suggested pushing the retirement age higher, arguing that Americans' rising life expectancy and the projected strain on Social Security's reserves will require workers to spend more years in the workforce.
Not everyone is lucky enough to reach 65 while in good health. Many workers end up taking retirement far sooner than they had planned, with health issues being a top cause. Because poorer Americans are more likely to suffer from health issues, many of those facing an unexpected retirement may be the least financial prepared to do so.
Lower-income workers are more likely to say they're never going to retire, the AP-NORC Center survey found. About one-third of those earning less than $50,000 said they planned to work until they died, compared with 20 percent of those earning at least $100,000.
"While there is evidence that older workers have some autonomy in the choices they make about late career work, we also see evidence that many feel compelled to work longer due to financial concerns and anxiety about retirement," the study noted.