The great recession has affected different age groups in different ways. Its impact on the generation of those age 55 and above, many of whom are nearing retirement, has left many “Baby Boomers” with unique financial challenges. Our
guests explore how some older Americans have dealt with the unexpected hurdles the recession has set in the way of their plans for enjoying their later stages of life.
Some Common Problems
Several of the factors that matter the most to many who are 55 and older are the terrible job market, the drop in home values, and the drop in the values of their retirement accounts. “That makes this time a very anxious one, a very worrisome time if you are 55 or older and you’re still working,” Gary Burtless said. According to Richard Johnson, the unemployment rate for those 55 and older is about 6.4 percent, which is lower than the national average, but still very high. The real problem for people in this age group is that when they lose a job, it generally takes them much longer to get a new one than it does for younger workers, Johnson said.
The Issues Behind The Jobs
Diane asked the guests why it takes so much longer, on average, for older workers to find new jobs. Johnson said there seems to be a perception among employers that older workers are more expensive than younger ones, and that their employer health-care costs are higher. There’s also a concern, Johnson said, that older workers might retire in just a few years after being hired – a situation that many employers are wary of in terms of investing time and money in training a new worker. Some employers have tried to offset rising health care costs for workers of all ages by setting up health savings accounts for employees, depositing money in the accounts, and leaving it up to the employees to shop around the the best health care plans.
Psychological Stresses On Baby Boomers
As a Baby Boomer herself, Mitchell said she and her peers are coming to terms with the fact that their retirement years are going to look quite different from those of their parents’. “Social security, medicare, all these programs are facing much bigger problems…our home values have declined, our 401Ks are fairly limited. And health care costs just seem to be quite astoundingly high,” she said. One way that people who are in relatively good health can try to compensate for these challenges is to work longer into their sixties in order to claim the maximum social security benefit, Mitchell said.
Is It Possible To “Reinvent” Oneself?
A listener in his early fifties wrote in to say that he’s feeling a lot of stress about his current job prospects. He wondered if it was really possible to reinvent himself at his age. Mitchell said that as much as possible, older workers need to try to keep retraining themselves on the latest technology and skills. Johnson added that some employers have a tendency to view older employees as not being as “up-to-date” on the latest skills as younger workers are, and so the burden to prove their competency in this area falls on the older worker.
You can read the full transcript here.