Political Schadenfreude
INTERESTING STUFF: 28 May 2011

Impact of Recession on Elders

This week, the AARP Public Policy Institute released a preliminary study of a survey they conducted in October 2010 with 5,027 men and woman 50 and older.

ITEM: 24.7 percent of exhausted their savings

ITEM: 19.4 percent fell behind in credit card payments or accumulated more card debt

ITEM: 12.4 percent lost health insurance

ITEM: 49.5 percent put off medical or dental care or were not taking their medication on schedule

Here is the full graph related to hardships from the recession:

Hardship Graph

ITEM: 52.7 percent rated their family's financial well-being as only fair or poor

ITEM: 41.4 percent saw their their retirement savings balance decline and not recover; another 49.3 percent said their balances declined and are not back to pre-recession levels, but are moving in the right direction

ITEM: 13.5 percent began collecting Social Security to help make ends meet; of those, 67 percent began collecting the benefit earlier than they had planned

Although all the statistics are troubling, the last hits me hard because when a person takes early Social Security, the benefit is permanently lower than it would be at full retirement age and beyond.

After being forced to give up my fruitless, year-long search for work, frugal does not begin to describe how I lived for a year until I was eligible for the full benefit at age 65 and eight months. But I believed it was crucial to hang on for that full amount - Social Security is 85 percent of my income and I knew I would need every penny of it for the rest of my life.

Only people who had been in the labor force at some point during the previous three years were included in the survey and some questions asked for a personal assessment of well-being – this one regarding their financial situation:

Financia lWellbeing Assessment

Another asked what people were doing now to prepare for a more secure retirement:

Preparing For Retirement

In their overview of the report [available online here - pdf], AARP notes:

”...one-third said they expect to delay retirement. Yet many jobseekers were still unable to find employment.

“Recovery for persons most adversely affected by the recession (e.g., the long-term unemployed, those who filed for bankruptcy) will likely be long and slow, and some may never make it back to where they were before the recession.”

You work hard all your life, do everything right and then some rich banksters come along and destroy your plans. They will be fine, but you won't.

AARP will release the full report from the survey later this year and I hope there will be more in-depth coverage than in this first release of the people who will not recover their losses.

Meanwhile, how are you – retired or still working – making out? Feel free to comment anonymously if that is more comfortable for you.


At The Elder Storytelling Place today – Susan Gulliford: Music Lesson


Comments

Working.
Get paid less, use IRA to supplement and maintain accustomed lifestyle.
Full SS in 2.7 years.
Hope to keep working until then.
I'm doing fine. Had gotten lucky landing a high tech career with soaring stock, pension, profit sharing, etc.
I always did and still work average of 50+ hours per week.
Hard work can be rewarding if in the right field / company. I could have just as easily not landed in high tech and been in one of those bar charts--it's all fickle fate, but we all end up at the same place in the end.
And my (our) status could turn on a dime for health or natural disaster or calamity. We just never know. Good luck to you all.

I'm doing fine, thanks to the stock market the past 25 years. My S.S.only covers my health insurance so I worry about the cost of live-in-care if something serious happens. It's about $30,000 a month in Seattle. Most of us would be wiped out if that had to continuer for any length of time.

I was interested in the the "49.3 percent [who] said their balances declined and are not back to pre-recession levels, but are moving in the right direction." I'm in that set, working and holding out for full SS.

We're nearly a majority, have learned painfully to be more anxious -- and I think constitute the politically volatile segment of our age cohort, ripe for demagogues (think Tea Party!) The world crashed about us and we don't know when another brickbat might fly by and hit our heads this time. Trouble is, the demagogues aren't offering solutions, just getting people stirred up.

I've been on retirement income 18 years. On SS/Medicare only. Have been a Full-Time RV'r for 27 years. At the beginning of my RV life, for first 9 years, had NO income beyond what I generated while RV'ng. Did so without prostituting myself,physically, mentally, emotionally, or spiritually.

I still live in a 32' 18 yr. old Motor Home in a "Co-Op" RV park, for less than $100/month rent/utilities. I am healthy, live comfortably, am a Vegan, save more than 50% of my income.
My only phone is a TracFone (prepaid). I only make calls...do not share my number. Do not have/use credit cards, Debit card only.
Wi-Fi is available at my RV park/home-base 24/7/365 at no extra charge. I communicate via email...not phone.

I volunteer/play music weekly at a nearby Nursing Home.

My plan has always been typical of people born during the Great Depression.... If you do not have the funds, do not buy! Live frugally, budget, and SAVE as much as possible.

NEVER BUY ON TIME...Only buy with cash!

I just bought a 2011 brand new car...my first.

Elizabeth

I was forced into early retirement due to the economy. Social Security is my only income and it's not much because I spent most of my life as a mommy at my then husband's behest and I don't regret it.

The economy is killing me. I joke that there's too much month at the end of my money but it's really the truth. Some people think that I should get married again but I'd rather drink poison.

I'm not complaining -- I made my choices and have to live with the consequences and that's just life. I do, however, resent those who would take what little I have away from me.

God I knew it was bad, but I didn't realize it was THAT bad. I sure live in a prosperity bubble.
We are having to spend a lot of money to keep our kids solvent, and my husband still works, although he is approaching age 70.

My money will never be back to where it was. I'm now taking a thousand some a month out of it to augment my SS of 400. Starving artists don't just starve when they are young. My kids are on their own....with the help of computer repair here or there on occasion. My truck is 17 years old, and G's car is 6. I won't ever go back to work as my hip remains out of tune with working. Our savings is almost back to where it was, and he is looking forward to not working. We have no bills and a very low mortgage. I love retirement.

I still have my little IRA. The last time it started sliding I did take out enough to pay off the last of my mortgage, I felt if it was going to disappear I'd better get some good out of it. It has regained my deduction and is still growing some. I lost less than some as I moved my money sooner than most into more conservative investments. In addition to SS I have a small pension that's enough to pay for supplemental medical to Medicare and pays my house taxes and insurance. I am considering replacing my very expensive supplemental insurance. My house has lost value but not at the rate other communities have experienced but I'd have a devil of a time selling it. The taxes continue go up!? I filed for an adjustment each year but kept getting turned down. However since the divorce my income is small enough I'm eligible for a 60% exemption. I also have a son who needs some help right now. I may end up using some IRA money for that, he was laid off with 300 other people, has no medical and insulin dependent diabetes. All in all I'm doing okay but anymore of this "non-existant" inflation will make things difficult for everyone.

Very interesting survey results. Obviously there are many folks over the age of 50 who have a difficult situation. The good news is that even the Republican plan does not eliminate SS or Medicare for them. The next generation may have more difficulty unless the economy improves.

Interesting reading. I know I have been very fortunate and give thanks everyday that I was able to work for 30 years in a state job and retire at age 54 with an annuity check equal to the net salary I was receiving monthly. As a state retiree my health insurance premium is paid 100% although co-pays and deductibles have been increasing annually. My profession is in demand and I have not had any difficulty finding part-time work and could work full-time if I really wanted to do so. I do plan to work as long as I enjoy it and at least until I can receive full SS benefits at age 66 (in 4 years). The small 401-k remains untouched and is growing slowly. Overall, I know I have been extremely lucky.

Things are going well at our house.

Although house prices in our neighborhood dropped about 5% from their high, our home is still worth about double what we paid in 1989. We paid our house off in 1997 by working an extra job each and applying the income to extra payments.

No debts.

We each work part-time jobs, not due to financial hardship.

Our financial planner reccomended we take SS as soon as we were able and invest it conservatively, therefore one of us is on SS and the other will be in the next few years.

We have a pension and medical coverage due to a "corporate buy out" seven years ago.

Our investments recovered from the stock market drop. We received a small inheritance which we also invested.

Until July 2009 I had a job I loved. I directed an adult day program at a senior center for frail elderly.

I knew the future might not be so great when, in 2006, the nonprofit running my center announced they would not be increasing salaries by the usual annual 3%, but only by 1%. This continued into the following year, and in 2008 there were no increases.

Also that year, my hours were decreased by half, and the year after that my program was closed down.

I had fifteen people in their 80s and 90s whose children or spouses had, with great hope and relief, enrolled them in a wonderful day care program, and who were now left with nothing. Several were put into assisted living or nursing homes. I know of two who have since died.

As for me, it'll be two years in July since I became jobless. Other than an occasional stint doing an arts & crafts class in a nearby nursing home, my income has consisted of SS and UI, which will be running out in a few months. My rent takes up more than half of my current income. My daughter has assured me that I'll never be homeless, but I was really hoping for an old age a bit more rewarding than this...

We're doing OK here in Iowa. Investments and IRA are back or nearly back to peaks in May '07. House values are not depressed much either. I could not live on SS ($633/mo)but got 1/2 of ex's retirement at divorce. I've always been really careful with my money and made some good investments, plus having a nice inheritance from my mother (which is my old age cushion should I need care).

Some of my kids have needed my help these past 3 yrs. Hallelujah, SIL out of work x 3 yrs got a job !! Had to take a big pay reduction and make a move out of state, though.

So I'm grateful for some good luck and some good decisions. Hubby has pretty good income as well and we own our house.

Laid off last year. Unemployed now for 8 months. Unemployment Insurance benefit is running out. I have had to just take things one step at a time because, frankly, I find the prognostics depressing and they just work against any energy I have for solving this problem of generating an income.

How long this transition takes has been hard. Mapping out worst case scenarios while simultaneously reaching out into the Community for resolve has been tough. I've been forced out of my comfort zone and it is a smarmy ego death indeed. I want to say it is fortunate that I have low self esteem for levity but it is actually true that I can allow others to guide me better because of this. How ironical! People have been terrific to me and I remain hopeful in reinventing and rescuing myself somehow from this disaster. I am fortunate too that I was raised poor and I know how to survive on very little. However, I promise you this, if I get my bearings and back on my feet, there will be a banker or two with some 'splainin' to do to ME!

What is harder still is the reality of the nose dive and the prospect of loss. Trying to decide things like: when and if I must cash in the retirement that I'm vested into for cash to live on in 2012; or whether to rent my place out and move back to CA to live with a relative. (I can't sell because I bought with a friend and that person would be homeless if we sold.) Neither of these things are in anyway good and seriously undermine my ability to remain an independent agent in charge of my life and happiness.

I actually have no idea what my life is going to look like by mid December and I know it is unfair to find myself thus at 57. Having said that, earthquakes, tidal waves, floods and tornadoes are unfair too. It is not like I am alone in upheaval and this knowledges tempers me.

I quit working 2-1/2 years ago; no pension,always an independent contractor, no health insurance between divorce and Medicare [didn't need it, thank heavens] paid basic health care out of my pocket. Saved an IRA and have another savings as well -- took a hit two years ago but it's recovering. I've always been frugal [depression era parents lived that way and so do I]. I managed to travel quite a lot before not working but now will not although I love it. I can only see expenses increasing s income does not increase. Within the bounds of frugality I am generally content.

We're ok collecting SS & we both retired at 63. We're ok mostly because of some good luck & good decisions during 50 years of marriage. However, somedays I get a little trepidatious because if our health doesn't stay manageable we may need to use our savings for care in or out of our home. For my spouse, that is a real possiblity, so I'm remaining frugal & hopeful that it will all work out. Probably not much left for the kids, but they'll be ok. Dee

Reading these narratives is not easy. Few retirees feel secure financially and there is a great deal of disappointment and hardship. I can't help but wonder when the interest rate on savings and bonds will go up so retirees with some savings can capture a little more income in addition to social security and IRA money.

In case things aren't tough enough, some of those commenting have family members relying on them for temporary financial help! I hope that things will shift for the better when the economy starts to expand again--but who knows when will that be?

It has been an interesting few years since I was laid off at 64, just 2 months shy of my 65th birthday. So I was able to collect unemployment and Medicare. I finally took SS at full retirement and now I live on SS, Medicare and have a part-time job walking dogs. Though this was just a fill-in job at the time I was laid off, it has served me well and hope to be able to continue this for another couple of years. I do have a couple of IRAs that I never touched while working in a corporate job. All in all, I would say that I am doing ok, though I sometimes have misgivings about medical emergencies or long-term care using up all my money. So I am hesitant to touch my savings for fear that I may need it when I am in my 80s.
I have always had financial fear due to divorce and raising 2 kids on my own, so I know how to live simply. Life is good when I don't worry about money and feeling less than others.

My husband (81) and I (74+) are doing O.K. for now, but like Dee and Brenda, I worry about exhausting our resources, especially in the event of serious illness or disability. We have some long-term care insurance and savings, but like most ordinary middle-class retirees, we couldn't pay the humongous costs of live-in or nursing home care for long without going bankrupt. Partly because of that concern, my husband worked until he was 76, and I'm still working. I consider myself very lucky to have a P/T job that pays decently and good health, so far.

Our investments took a hit like everyone else's, but they seem to be recovering (thanks largely to a savvy financial adviser). Although our condo has lost value, we could sell below-market if we had to (we bought in 1996 with a 50% down payment). And yes, our property taxes go up every year!

We told the kids years ago that they were adults and not to count on substantial financial help from us. In return we've done everything possible not to need their help in our old age. We've planned as best we can, and our lifestyle is conservative (although our politics aren't). But we've been fortunate, too--I can only hope our luck holds.

We're ok, thanks to adopting a pay-as-you-go lifestyle many years ago. We will have less in the future because of low interest rates now and state tax increases for seniors. We have been lucky; it's sad to hear from those who have not enjoyed the same good fortune. We must fight on politically to see they are protected.

I'm okay. Husband and I lived modestly mostly paying as we went along. I continue to do so. Returning midlife for further education and training, then to begin a new profession, allowed me to do some catch-up for later retirement.

I think work opportunities for far too many people have significantly declined for quite a few years preventing some from doing more to prepare similarly. Certainly the ability for many to safely and securely earn income from savings has greatly deteriorated. This has adversely affected my comfort level to engage in some of my once expected retirement activities. These are serious factors negatively impacting the retirement years of far too many people.

I wonder what, if any, unexpected health needs may arise and if I'll be able to live my final years as I desire. I do not want to become a responsibility of a limited number of family members. I feel concern for the future my adult children and grandchildren may face.

I've continued to work part time partially due to concerns about the nation's/world's economic state. SS is certainly an important part of my income. I'm hardly immune to the adverse effects of increasing living costs and know I need to continue to be prepared to adjust as needed.

House values have declined in my city, but not as severely as in some communities. City expenditures increase, our State is in dire financial straits as is our national government. I wonder are officials going to turn to me to bail out our leaders who have been so irresponsible budgeting, regulating and governing for so many years? Are they going to ask me for more fees and taxes, but not those individuals and corporations who pay a far smaller percentage of their incomes? And what about those obscene monies glutenous Wall Street financiers are inhaling with every breath?

Sorry for commenting so late but it honestly has to do with office budget cuts!

Turning 52 in August, single, homeowner with no debts except the mortgage that I'm hoping to pay off early in a few years.

The association where I've worked since 1990 has fallen on hard times. No pay increases for two years and this year a pay cut in the form of four furlough days. One of which was the Friday of this post. I read this at home but due to my own budget cuts, I have gotten rid of my home internet and borrow a neighbor's wireless (and yes, she knows about it and has no problem with it).

Unfortunately, the signal cuts off sporadically so I rarely comment on anything at home due to the frustration of typing a long/meaningful comment only to be cut off.

Have tiaa/creff and it has made back the money it lost. Also my mother left each of her children around $80,000 that has been a godsend for me. Used a small amount (around $6,000) to reface my kitchen but nothing more. It is nice to have that as a cushion.

Who knows what I'll be getting in SS but the form I receive every year states it should be around $1400 a month. Tiaa/creff has estimated I should be able to take a little over $1000 a month at retirement. That, with a paid for home...crossing fingers that I'll be okay.

Impressive, except for one thing......who are the people who even support AARP anymore? I think the average American has dumped AARP as representing the rank and file of average Americans.
I know I have.
I consider their stats are taken from a pool of people not representative of most Americans.

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