The Security or Insecurity of Retirement

There has been much written about the affect of the current storm of financial issues and its impact to what I call personal economies.  Recently in the newspaper a feature was written highlighting local citizens.  The article found two particular individuals of retirement age who are working not just because of tough economic times to make ends meet, but also for the fact that they enjoy working and have no intentions to quit yet.  They are fortunate to have the choice so to speak.  Everyone regardless of their age is feeling the pinch.  Not everyone works because they like to, as these individuals.

Their experience is confirmed by a study conducted by AARP in 2007.   Over 2/3 of seniors indicated  that they planned to continue at least part time, even after they reached retirement age.  This study  attributed the reasoning to enjoyment of work – which is good news, and also needing to meet financial needs.  The latter is not so good because this study named ‘Work and Career Study’ was done in the spring 2007 when the market and economy were buzzing.

What is distressing is, now, according to the AARP report released in October called ‘Retirement Security or Insecurity’ it is revealed that due to the current economic climate, 20 percent of those interviewed have stopped contributing to their retirement savings, and over 10 percent are having to take money from their retirement savings to meet daily expenses.   AARP telephone surveyed over 1600 participants aged 45 and older who are currently employed.

Some KEY findings in the October report are that respondents -

• will work more hours and stop contributing to retirement accounts such as IRAs and 401Ks.
• will work longer, delay retirement, and spend less money in retirement.
• feel that their retirement efforts are/were not on track BEFORE the economy slowed down.
• are not saving enough for retirement, due to lack of money or not starting a plan.

For details and actual percentages, the study can be found here – http://assets.aarp.org/rgcenter/econ/retirement_survey_08.pdf.

As one lady quipped while lamenting the decline of her retirement balance, and having to work longer, “it is all in God’s plan and she’ll take life as it comes”.  We all can take comfort in that. Amen, sister.

It is hard to imagine anyone in the modern world not affected by today’s money headlines and whose experiences are not confirmed by the AARP study.  If your personal economy and retirement are threatened by assets in your portfolio that have lost money, then your current and future retirement security can perhaps benefit from a second opinion by giving us a call on 304-267-9797.