While retiring confidence has increased over the past few years, many Americans are still uncertain about their ability to retire when they want. A full 32% of post-retirement-age workers have jobs, up from less than a quarter in 2020.1 In fact, according to a report from Goldmann Sachs, 60% of respondents plan to postpone retirement due to competing financial priorities.2 Here are some reasons why individuals are retiring later in life.
1. They haven’t saved enough
One major reason why people are postponing retirement is because they haven’t saved enough. According AARP, 61% of seniors are worried they will not have enough money to support retirement.3
2. They need healthcare benefits
Healthcare expenses are a growing concern among seniors. According to a report from the Peterson-KFF, the average out-of-pocket healthcare expenditure per person reached $1,1514 in 2023, not including health insurance premiums last year.4 The need for healthcare coverage is one reason why seniors may work well into their golden years.
3. They’re supporting dependents
According to a survey from Bankrate, 61% of parents with adult children have made or are currently making a financial sacrifice to support their children financially.5 They are doing so at the expense of emergency savings, retirement savings and/or paying off debt.
4. They enjoy their jobs
The number of seniors over 65 who are working is at all all-time high. Many simply enjoy working and staying sharp. In addition, thanks to technology advancements, working offers more flexibility regarding hours and locations than ever before.
5. Due to setbacks
A struggling economy and surging inflation have caused some older Americans to postpone retirement. According to one survey, 26% of seniors reported that they are continuing to work full time in order to prepare for retirement during a recession. Another 20% say they are applying to part-time jobs.6
6. To maintain their standard of living
Many seniors continue to work because they will not be able to maintain their standard of living. According to a survey from Bankrate, 73% of Americans are concerned that promised Social Security benefits will not be paid when they reach retirement age.7
These are just a few of the many factors to take into consideration as you plan for your retirement. For a wide array of retirement resources and tips on saving for retirement, visit the Protective Learning Center, then contact a qualified financial professional.
Sources:
1. Federal Reserve Bank of Minneapolis, "Who's not working? Understanding the U.S.'s aging workforce," February 27, 2023.
2. Goldmann Sachs, "Retirement Survey & Insights Report: Putting Planning into Retirement Plans," September 2024.
3. AARP, “Retirement Savings and Over Half Worry They Will Not Have Enough to Last in Retirement,” April 24, 2024.
4. Peterson-KFF, “Health System Tracker,” December 20, 2024.
5. Bankrate, “Survey: 61% of parents with adult children have sacrificed to help their kids financially,” May 30, 2024.
6. Retirement Living, "Retiring into a recession," 2023.
7. Bankrate, “Survey: More than half of workers expect to rely on Social Security benefits when they retire,” November 21, 2024.
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