4/2/2013 5:30 PM ET|
Why older people work: For money
Being old enough to collect a Social Security check doesn't necessarily mean being able to afford living expenses without a job.
At 76, Robert Scheidly gets up at 2 a.m. for his daily four-hour newspaper route. His wife, Anna, 72, coordinates operations at a warehouse one day a week and applies for jobs the rest.
"I was hoping that by this age we would be able to maybe enjoy going to visit his or my brothers or sisters," said Anna, a former receptionist and bookkeeper. "But we both really need to work in order to make ends meet."
The Scheidlys' story is increasingly common. As those older than 65 become the nation's fastest-growing workforce demographic -- increasing at five times the pace of younger workers -- the primary reason cited for continuing to punch the clock is money.
Surveys consistently reveal this to be the case, even though seniors often find work to be fulfilling and may forget that money was their primary motivation.
"The reasons can change as people experience going to work," said Caitrin Lynch, an associate professor of anthropology at Olin College and the author of "Retirement on the Line: Age, Work and Value in an American Factory."
"A lot of people can't disentangle that," she said, "even if their initial motivation may have been that, 'I need to pay for heat in the winter.'"
The statistics are sobering:
- More than half the nation's workers are at risk of being unable to maintain their standard of living in retirement, according to research from the Center for Retirement Research at Boston College. Nearly two-thirds of low-income households are at risk.
- According to the Social Security Administration, 34% of the workforce has no savings set aside for retirement.
- For most families with members over 65, Social Security constitutes the bulk of household income, even though Social Security was never meant to do such heavy lifting. For those in the middle third of the income scale, it provides 71% of income; for those in the bottom third, 88%.
- Social Security income averages just under $16,000 per year for those ages 65 to 74, less for those past 75.
- In 2020, nearly a quarter of Americans over the age of 65, or 22.6%, are projected to be in the workforce, according to the Bureau of Labor Statistics, compared with 11.8% who worked in 1990.
Like millions of Americans, the Scheidlys had always been frugal, and they had always worked. Robert was a welder until his factory shut down in 1987, then a minister.
"We lived hoping that we could retire, but we didn't set anything aside because we used what we got, mainly to raise a family," Anna Scheidly said. "Some people would say that it was our fault because we didn't plan right, but you do the best that you can in the situation you are in."
According to the Employee Benefit Research Institute, two-fifths of families with seniors are like the Scheidlys, with expenditures outweighing income in retirement. And the recent economic turmoil isn't to blame -- at least not fully.
Yes, the stock market crash depleted individual retirement plans. The housing crash sucked the value from many people's greatest asset. And for some, the recession added the financial burden of supporting younger relatives.
But these factors merely exacerbated trends that have been in the making for 20 to 30 years, say experts. The typical working lifetime has expanded as wages have fallen, and a great share of jobs available are less demanding physically. Meanwhile the shift away from company pension plans has put the onus on workers to save for retirement.
In just one generation, the shift away from pensions has been dramatic. In 1983, 88% of workers were enrolled in a private or public employer pension plan. In 2010, only 31% were, according to the Center for Retirement Research.
More from MSN Money:
VIDEO ON MSN MONEY
Hmm, interesting comments so far. But when are we going to realize we can't all live like superstars? When are we going to take responsibility for ourselves and stop with the "latest and greatest" of everything?
I was not put on this earth to make the utlitity companies, the entertaners, Samsung, Verizon, auto companies, etc richer. Would I like to have my house temperature at a comfortable 75 degrees all year round? Sure, but at what cost? Do I REALLY need a Smart phone, no, I survived when there were still party lines, no call waiting or voicemail. I know how to read a map. I know how to write a letter and be patient for a response.
I don't have the answers, but I try very hard to be accountable for every dollar I spend. And yes, I will be poor when I retire. I will just have to adjust my standard of living.
This situation has been created by existing thinking of borrow first and pay later instead
of earn and buy within means.
I applaud the Scheidly's for supporting their family during their younger years with their own earnings rather than relying on public assistance, food stamps, and all the other programs that so many people choose to and some need to rely on today. If that means they still have to work now, that is because they still want to support themselves and not rely on others.
Unfortunately we currently have the last generation of people who often have pensions in addition to social security, and these people can often retire or help out their kids or grandkids with their retirement money. I see it all the time at my job where seniors help pay for food, clothing, school supplies or other items for both their children and grandchildren because their children are working at jobs that pay minimum wage or pay less money than jobs used to pay 20 to 30 years ago. Their children often have no health insurance and sure don't make enough to save for a crisis or for retirement. So the parents often help out adult children.
Another situation that is getting more common today is younger people on public assistance, social security disability, and food stamps supporting their elderly parents and grandparents with their welfare programs. They usually live in the same household. Grandchildren are encouraged to have children as soon as possible to increase the total family "income."
It is too bad that no one in the media dared to ask either Presidential candidate about this issue. The media was too busy trying to avoid the issues and when they would ask a question they did not demand that Obama or Romney actually answer the question. So all we got was a bunch of political BS talk and now we are stuck with a mess that is only going to get worst.
Democrats and Republicans are so busy protecting the banks and auto executives. They never cared enough to do even the simplest of things to help "we the people". I have some ideas how they could have help us.
First, take back the money that the banks and auto companies paid in bonuses to the Executives and use it to increase the unemployment benefits. Second, make the unemployment benefits not taxable period. Third, for every dollar a bank received to save its ****, the bank must forgive loan payments to those facing foreclosure.
Instead of helping people save their homes the President, Republicans and Democrats helped the executives keep there private jets and luxury cars and big salaries.
If you don't save enough for retirement you won't have enough for retirement.
This is basic math people. Stop blaming things you you have no control over, and take care of your buisness!
Copyright © 2014 Microsoft. All rights reserved.
If you're one of the millions of sleep-deprived Americans, here's how to find cheap sleep without pills.