Saying goodbye to retirement savings

For many Americans, retirement is the most anticipated moment after decades of hard work, a well-earned break for each and every worker who has spent years working and paying taxes so that, when they reach their golden years, they can rest. However, a large number of our elders are returning to the workforce because their retirement savings have become insufficient. This is changing the employment landscape in the United States and raises complicated questions about retirement and the planning that each one does for the fruits of their labour.

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Forced to work again

Rising inflation, along with high costs of living and health care, has left many retirees without options. This is the case of Sylvia, who, at 63 years old, decided to sign for early retirement, and, a year later, has been forced to go back to work because her monthly income is not enough to pay the bills, and her pension has been reduced to $2000!

Sylvia is just one visible face of the thousands of seniors who are suffering from this same lack of financial planning and who regret not having built a solid economic base for when they retire. So, like many other seniors, she had to start looking for part-time work at 64 years old.

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And many of these elderly people make the mistake of believing that the early retirement benefit from Social Security is enough to survive, however, when you retire at 62 (the minimum retirement age) the salary you have left is reduced by up to 30%.

Sylvia, in her case, has found work in a grocery store, however, she feels that it is taking its toll on her both physically and mentally, but she feels that she needs the money (and she still doesn’t know if she will be able to stop working and be able to retire under good conditions). During her work, Sylvia reflects on the country’s employment situation, where, with a master’s degree and an award from state senators, she has not managed to get a better job than the one she has now (supermarket cashier).

Inflation and the impossibility of surviving on SSA

Many retirees have been left with no other options with rising prices and health care, and many older workers have underestimated the amount needed to maintain a comfortable lifestyle in their old age when it came time to retire.

The Federal Reserve Bank of St. Louis reported that more than 2.4 million retirements occurred in 2020 when the pandemic began, however, the same report, two years later, confirmed that 1.5 million of these retirees had been forced to return to work in order to cover basic needs. And one in five adults over 50, according to a survey by NORC of the University of Chicago, claimed to have no retirement savings.

Where can an ex-retiree work?

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As we have just seen, many elderly people have been forced to look for jobs, however, they now face many more difficulties, because many are being discriminated against for age, or for lack of technological knowledge, which means that many “reintegrated” people need job training and job literacy. So, many are looking for jobs that are much more physically demanding (but where they are required to have less training in technology)

The sectors most in demand by the elderly

• Customer services.
• Retail trade
• Management and consulting.

Resources for Seniors in the job market

Many seniors cannot find a place to work that is appropriate to their physical abilities (imagine being 73 years old and needing to return to a construction site…) Therefore, many experts advise applying for government assistance, such as SNAP or other financial resources suitable for people with low incomes.

So, you see that it is vital to plan before making what is probably the most important decision of your life: retirement.

Make sure you have tax advisors to make the most correct decision and one that suits your needs. In the meantime, let’s continue working!