We baby boomers are going to have to face some hard truths. The economy, the amount of retirees and immediate future retirees, and the amount of workers left in the work force are all factors in what has amounted to a phenomena. This phenomena is the working retiree. Listed here are some baby boomer retirement facts that you need to know in order to plan for your future, and perhaps become a working retiree yourself.
The Anger Inducing Social Security Facts
According to the Social Security Board of Trustees, Annual Report, Social Security benefit dollars will run out in the year 2034. I will hit 70 years old that year, and will be right in the middle of receiving Social Security money. The thing that makes me angry is that I have worked since I was 15 years old putting money into that account. That’s 40 years!
The report also states that only 79% of an individual’s benefit will be payable at that point. The 79% payout will be available through 2090, in which year I will be 126, but I doubt I will be here THAT long.
So I’m going to get a cut in pay about 3 years after I retire, if I last until 67. 67 is the age in which a person (born in 1962 or later) receives full benefits. Your FRA (Full Retirement Age) will differ, depending on when you were born. Bear in mind too, that you get reduced Social Security benefits if you retire before your FRA.
You are able to work while receiving your Social Security benefits. “This year, Social Security deducts $1 of benefits for every $2 earned above $15,720. For those reaching full retirement age in 2016, Social Security deducts $1 for every $3 earned above $41,880. Once you reach full retirement age — 66 for those born from 1943 through 1954 – you can earn an unlimited amount without a reduction in benefits.
And by the way, Social Security is designed to replace only 40% of your income.
All of this information can be found at the AARP website, https://www.aarp.org
We Don’t Have Enough Money Saved
- 17% of workers very confident in their ability to live comfortably in retirement, according to the Employee Benefit Research Institute.
- 25% of current retirees who indicate some of their income comes from working for pay during retirement.
- 40% of current retirees who indicate their healthcare costs have been higher than anticipated.
“In fact, future retirees responding to one Nationwide Retirement Institute survey thought they’d spend 20% of their Social Security benefits on healthcare, but the average retiree who claims Social Security benefits at 64 could actually end up spending almost 65% of Social Security benefits on medical expenditures.” https://www.fool.com
According to the Economic Policy Institute, the 56-61 age group (which can be considered “pre-retirees”) has an average retirement savings of $163,577.
According to a 2018 study by Northwestern Mutual, 21% of Americans have no retirement savings and an additional 10% have less than $5,000 in savings. A third of Baby Boomers currently in, or approaching, retirement age have between nothing and $25,000 set aside.
The Ugly Truth: We Are Going to Have to Work
The number of working Americans between ages 65 and 74 is expected to increase 4.5% between 2014 and 2024, while the number of those between 16 to 24 is expected to drop 1.4%, according to US Bureau of Labor Statistics.
So, it’s looking like we will all have to work through our retirement. We will have to find that side gig that helps with the health care bills and buys groceries. But the news isn’t all bad. Now is the time to do that thing that we always wanted to do! Here are a few suggestions:
Become a tutor, teachers aid, or teach English as a second language: Have you always wanted to work with children? Have you wanted to help people overcome barriers and open up to their full potential? Getting a teachers license is fairly easy if you already have a Bachelor’s degree in a given area. Most states have certification programs at state sponsored schools, Colorado (where I live) requires 800 hours as a student teacher to get a teaching certificate.
Work a seasonal job: There are hundreds of seasonal jobs available to older applicants. Try landscaping, tax prep, hospitality work, Christmas package handling and delivery, resort work, or campground host (at state and national parks). Check out https://www.coolworks.com/older-bolder. They have great jobs for seniors posted at national parks all over the country.
Do freelance, contract, or consultant work: Try Upwork at https://www.upwork.com/ This is a platform for freelance workers, that helps you find work and then helps you with tracking your hours and pay, and a lot of other tools. It’s free to join, but they also offer a premium membership that gets you exposure to premium jobs, etc. FlexJobs at https://www.flexjobs.com is another great freelance platform, but they require a paid membership.
Try a retail job: Retail outlets are always looking for good people to fill part-time jobs. They don’t pay very much hour, but they do offer flexible schedules. The big retail stores often hire senior greeters. Fast food restaurants often hire a retiree for a front dining room to bus tables and keep supplies stocked.
Do affiliate marketing: Affiliate marketing is by no means new. This is a method of promoting companies on your website, and if someone makes a purchase through your advertising, you get a commission. By far the best platform for affiliate marketing is Wealthy Affiliate. They have a training program that works for beginners and experts alike. Also, the community of bloggers and online business entrepreneurs at Wealthy Affiliate is inclusive, supportive, helpful, very positive, and takes the attitude of paying it forward. For a small fee ($49 per month) you will receive all the training, hosting, and support you need to create your own money making website. It’s not easy. It takes work. But it will pay off in the long run, and can very easily be learned and maintained by a senior worker.
It’s Coming, So Let’s Get Ready
I know it isn’t easy to think about retiring in an economy that barely supports us working at full capacity. But by planning ahead now, by learning that new skill, by creating a paying website, and by thinking about what we really want to do, we can avoid the ambiguity of losing our income in the coming years. Whether we like it or not, we are going to have to stop working at some point, and it will be better to be prepared when that day comes. Thanks for reading, and if you have any questions or comments, please type them below.