Increasingly my conversations with my contemporaries are around retirement, specifically the lack of desire to retire. Some people might consider believing we won’t retire or at least that we won’t retire for years after any official retirement age as pessimistic but at least part of the lack of desire to retire has something to do with the fact that what we do to make a living is what we are interested in doing. We can all imagine perhaps doing less of what we do or doing something different but we can’t imagine not doing. That mimics a growing trend in America. The share of workers over 65 in this country is the highest it’s been for over 50 years. It’s one of the fastest growing changes in the American workforce.
For the forty decades after World War II, the number of American men 62 or older still in the labor force fell due in part to the advent of Medicare, Social Security and employer-provided pensions. A combination of longer lives and early retirement boosted the number of retirement years from 10.9 years to 19.3 years for men and from 12.5 years to 23.5 years for women according to the Social Security Administration. That’s changed in the last decade. According to the Bureau of Labor and Statistics, the employment of workers 65 and older increased over 100 percent between 1977 and 2007.
What’s changed is that Social Security benefits declined because of the gradual increase in the full retirement age (FRA) while at the same time employers became concerned about their own ability to remain competitive while still providing healthy pensions and retiree health benefits and responded by shifting from defined benefit to defined contribution plans. The shift in both public and private benefits to the employee has meant that the employee often no longer has adequate benefits for a longer retirement. The result is that public officials and financial experts alike encourage people to work longer and delay collecting Social Security benefits.
As might be expected the labor force participation rate (LFPR) has subsequently increased. Men aged 65-69, for instance, increased their LFPR from 8.7 percent to 17.3 percent between 1980 and 2010. Women took until the 1990s to show a similar trend but they too are showing substantial increases in LFPR although for them, part-time work dominates full-time work.
So, as Paul Solman, a business and economics correspondent asks, “Is retirement as we know it becoming a thing of the past?”
Not necessarily. However, the reason for retiring or not retiring appear to be changing. According to a PBS survey people over the age of 65 continue to work for a variety of reasons but nearly 70 percent do so because they want to feel useful and productive. Almost 60 percent do so to have something to do. Perhaps unsurprisingly, most 65-plus workers are happy with their jobs while their younger contemporaries are much less likely to feel the same way.
Still, you may not be among those happy to continue working or worse you may not feel that you can afford to retire. If you’re 50, can you still plan for retirement? “Absolutely,” says Julie Price from Julie Price Consulting. If you have 5, 10 or more years until retirement a financial planner can help you discover whether you’ll be able to afford 3 months each year in a sunnier climate. But, they can also help you to look at your finances and build a financial plan. While most financial experts focus on those in their 20s, 30s and 40s the reality is that most people have smaller income levels and higher expenses at those ages so it can still be beneficial to hire a financial planner in your 50s to help you maximize your retirement income. What’s more they can help you determine whether you really don’t have the ability to retire or if steps now could make retirement possible if that’s your aim. That can give you the option of choosing whether or not you retire instead of making the choice for you.
Finally, if you don’t believe you’ll have enough money to retire, protect the one asset you’re likely to have now while you’re still young—your health. Staying healthy will allow you to continue to work if that’s what you’ll need to do, will prevent your health care costs from spiraling out of control as you age and allow you to stay as independent as possible. What’s more, your health will make your retirement years, however you spend them, far more enjoyable.
Here’s some stories of inspiring older workers.