Baby Boomers Taking A New Look At Retirement

A recent AllState-National poll found that Baby Boomers are pushing back their initial retirement plans from an average of 60 years to 66 years. In addition, the results of the poll showed that 68% of the Baby Boomers expect to work in some form after retirement. The concept of retirement age is no longer what used to be 10 years ago. According to a survey conducted by Wells Fargo & Co in August 2011, 76% of the middle class Americans surveyed considered that “it is more important to have a specific amount saved before retirement, regardless of age, while only 20% say it is more important to retire at a specific age, regardless of savings.”
Other results of the Wells Fargo survey:

1. 25% of middle class Americans say they will “need to work until at least age 80” to live comfortably in retirement.
   
2. 74% of middle class Americans expect to work in their retirement years, including 39% of all respondents who will need to work to make ends meet or maintain their lifestyles, while 35% say they will work because they want to, rather than out of financial need.
   
3. Among middle class Americans age 40 to 59, 54% say they will “need to work,” compared to 34% of those age 25 to 39. Accordingly, only 25% of those between the ages of 40 and 59 say they will work in retirement because they “want to,” versus 45% of Americans between the ages of 25 and 39.
   
4. Of the Americans who will work in retirement, 47% say they will do “similar work” to their pre-retired years, while 42% say they will work in a position that requires “less responsibility.”
   

These changes in behavior bring some interesting questions and potential implications in our society. Will baby boomers be physically and mentally able to work later in life? Be efficient and productive until ae 80? What will it mean to the young generation entering the workforce in the next 10 to 15 years from now? And, how does our system of retirement savings need to be reformed to help reduce the savings gap?”
This recession has taken a heavier toll on the middle class than past recessions. However, the “sandwiched generation” (those near-retiree sandwiched between the already retired and the young generation) will feel a heavier burden since their retirement savings and real estate values have both declined substantially in the last 7 years. This has caught many near-retirees by surprise and now will force them to stay in the work force longer than they anticipated.
There is still time to make corrections in your retirement plans if you are in that “sandwiched” situation. It will take immediate action and potentially making some strong and sacrificial changes over the next 5 to 7 years to make sure that you can enjoy a comfortable retirement.