Thursday, October 22, 2009
Is Working Through Retirement the New Trend?
By: Eric Gursky
When people think of retirement they imagine the days playing golf and sipping on an umbrella drink somewhere warm. That society norm was 10 years ago, now that our economy has rapidly changed and people's 401k futures are less secure we are seeing an increasing number of 65+ workers still playing a major role in the workforce. In fact, Marc Freedman, author of Prime Time, describes how the baby boomers will transform how society views retirement -- bringing about a new image of aging, retirement, and the role of older Americans in our society. He cites statistics that show that in just a few years the number of folks over age 50 will surpass a quarter of the U.S. population. And the U.S. Bureau of Labor Statistics reports that baby boomers are reaching the age of 60 at the rate of one every seven seconds. Many of these folks will be searching for something beyond a leisurely retirement. Whether you work after age 65 will depend on many factors -- whether you have a defined-benefit plan or retiree health insurance, whether you are in good health, whether you can find work. But make no mistake about it: Some of you will work past age 65 and earned income will play a significant role in your finances. Of course, this new reality is often a function of need, particularly with the recent downturn, Freedman said. "But social norms are fast changing," he said. "Many folks simply want to continue to go to work to engage with other people. It makes them happier and gives them a greater sense of purpose." After all, earning a paycheck in your latter years can make a huge difference in retirement living standards. Pocketing even a slim income often allows retirement portfolios to compound over a longer period of time.