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More people are working past age 65
Old 04-09-2010, 09:18 AM   #1
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More people are working past age 65

More over-65 Americans staying in work force | Reuters

"Older workers have delayed retirement because of a drop in household wealth tied to the real estate and stock market falls of the past decade, according to the report released by Thomson Reuters/University of Michigan's Surveys of Consumers."
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Old 04-09-2010, 09:25 AM   #2
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Just one more nail in the coffin for a long, healthy retirement as a middle class expectation, especially for folks working in the private sector. People who plan early and save until it hurts can still get there, but those who plan on a "money fairy" rescuing them in their 60s are in for a rude awakening.

Next up: the return of the "extended" multi-generational family unit.
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"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

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Old 04-09-2010, 09:32 AM   #3
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Glad to hear it. RV parks are getting crowded.
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Old 04-09-2010, 09:52 AM   #4
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More over-65 Americans staying in work force | Reuters

"Older workers have delayed retirement because of a drop in household wealth tied to the real estate and stock market falls of the past decade, according to the report released by Thomson Reuters/University of Michigan's Surveys of Consumers."
How miserable. My heart goes out to these people.
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Old 04-09-2010, 10:08 AM   #5
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How miserable. My heart goes out to these people.
I doubt that many of them gave you a thought at all while you (and I) scrimped and saved, and spent time studying books on investments, diversification, efficient portfolios, and tax optimization, while they were on a beach sipping an umbrella drink.

OK, that's a gross generalization, but seriously - what is the difference between you and some of your co-workers who are unable to RE? You probably had similar incomes and benefits, the difference is you put your mind to it. I can't feel sorry for someone if they chose a different path. It was their choice. There is something to be said for beaches and umbrella drinks, too.

-ERD50
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Old 04-09-2010, 10:12 AM   #6
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I doubt that many of them gave you a thought at all while you (and I) scrimped and saved, and spent time studying books on investments, diversification, efficient portfolios, and tax optimization, while they were on a beach sipping an umbrella drink.
I think a lot of people just don't give retirement much thought when they are in their 20s and 30s. The problem is that those are the years when an invested dollar goes a very long way toward enabling retirement.

Or maybe they saw their parents (who may have had good pensions and retiree health insurance) retire comfortably without much savings and just figured they could do the same. But the rules are changing...
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"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
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Old 04-09-2010, 10:22 AM   #7
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I doubt that many of them gave you a thought at all while you (and I) scrimped and saved, and spent time studying books on investments, diversification, efficient portfolios, and tax optimization, while they were on a beach sipping an umbrella drink.

OK, that's a gross generalization, but seriously - what is the difference between you and some of your co-workers who are unable to RE? You probably had similar incomes and benefits, the difference is you put your mind to it. I can't feel sorry for someone if they chose a different path. It was their choice. There is something to be said for beaches and umbrella drinks, too.

-ERD50
But ERD50, you are old enough to know that we never know what life will bring. For example it was not due to my virtuous scrimping and saving that my house was not destroyed by Hurricane Katrina, while many of my friends' homes and about one third of my co-workers' homes were destroyed. Many are still battling with their insurance companies in court. Others settled for pennies on the dollar compared with their losses and what they thought they would have received. My former supervisor lost her home, couldn't find a rental (a real problem for many after the storm), and so bought a second home to live in while getting her first home rebuilt. Now she has TWO homes sucking up her money and losing value in this market, not to mention two kids in college and construction loans to pay off. Ewww. I wonder what I would have done had that been me. Sleep in my car, and shower at the gym, I suppose. But she had a husband and two teenagers to house. And both of us were lucky that we still had a job.

There are also many who lost nearly everything in the market crash. That could have been me, had I not come across the M* Diehards board from where I first heard of this group of jokers message board and from which the Bogleheads' board arose. I was lucky to have come across the Bogleheads and to have listened to their investment approach in formulating my own. Look at the investment book section at B&N the next time you are there. There are some really scary books advocating investment strategies that would give a Boglehead nightmares.

Others face the financial ruin and nightmare that we call "divorce". Been there, done that, and lost everything (but thank goodness I was only 50 so I had a decade to recover financially). Some marriages just crater and often there is nothing one can do to predict that or to save them.

Some have kids that are disabled and I understand that can be expensive as well.

You never know what life will bring. There but for the grace of G** go I.
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Old 04-09-2010, 11:01 AM   #8
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So, the over 65 workforce was much higher, declined steadily for decades and hit bottom in the mid-90’s and has been rising since. It now appears to be around be same level as the mid-70’s for men, lower but rising more quickly for women.
The trend upwards appears to have begun before the crash of ’01, so it’s not at all clear that this is due to real estate and stock market loss. I would suspect that much has to do with a combination of inadequate retirement planning together with better health and better healthcare for seniors.

From the BLS
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Older Workers: BLS Spotlight on Statistics
No, because in 2007 the baby-boom generation — those individuals born between 1946 and 1964 — had not yet reached the age of 65.
Between 1977 and 2007, the age 65 and older civilian noninstitutional population — which excludes people in nursing homes — increased by about 60 percent, somewhat faster than the civilian noninstitutional population age 16 and over (46 percent). Yet employment of people 65 and over doubled while employment for everyone 16 and over increased by less than 60 percent. How can employment increase more than the population? A larger share of people 65 and older is staying in or returning to the labor force (which consists of those working or looking for work). The labor force participation rate for older workers has been rising since the late 1990s. This is especially notable because the 65-and-over labor force participation rate had been at historic lows during the 1980s and early 1990s.


edit - trying to get a nice chart from the bls but can't.
second edit for glaring typo
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Old 04-09-2010, 11:07 AM   #9
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but those who plan on a "money fairy" rescuing them in their 60s are in for a rude awakening.
Not only am I burning through the 60' much faster than expected but, now you tell me, there is no "money fairy"? Oh woe is me.
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Old 04-09-2010, 12:49 PM   #10
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I think a lot of people just don't give retirement much thought when they are in their 20s and 30s. The problem is that those are the years when an invested dollar goes a very long way toward enabling retirement.

Or maybe they saw their parents (who may have had good pensions and retiree health insurance) retire comfortably without much savings and just figured they could do the same. But the rules are changing...
I know I didn't think much about retirement when I was in my mid-20's and I would guess there are a goodly number of twenty-somethings today who don't either, and for the same reason I didn't, which is that they are worrying about where their next paycheck is going to come from, not where their money will come from in thirty or forty years. I and they got caught in a period of high unemployment just when it does the most damage to their future ability to retire early, or retire at all for that matter. And over-65's hanging onto their jobs will make it that much harder for the twenty-somethings to start saving as early as they will need to.

I also think parental example has a lot to do with it. I don't know how much my parents were saving, because they didn't talk about it. I knew they owned a rental house, but they never went into specifics about how much it cost, rental income, tax benefits or any of that. I think whether parents are not saving or saving but not talking about it, there is a similar effect on the kids' perceptions: they never realize the need to save, or realize it too late to do much good.
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Old 04-09-2010, 01:44 PM   #11
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My take on this is W2R has got it right. You never know what life will bring. I personally know many people, including ourselves, who took big financial hits due to Katrina. We just picked ourselves up and carried on with not adequate help from our insurer, and asked the govt. for nada.

We have always planned and saved for retirement. Financially we are in sound shape but who knows what this summer will bring. Those of you along the West coast --- could have your lives "shook up" and the East Coast was mighty wet this year. You can't point fingers and say that "because people didn't save........."

There are so many variables for which one cannot plan. That is why we have so many people filing for bankruptcy due to medical issues. (No --- I do not like this new health care package --- but that's another story).

My spouse (laid off) retired in 2009. However, we knew for years that it was coming. That was fine. We are 63 and no problems. The market downturn gave moments of indigestion but, fact is we were just fine.

A few months ago, my DH went back at work fulltime with another employer and is most happy. How long he will do this is ?? But.........he is happy to be there and that is what counts. When it becomes a "drag" he is GONE. So....RE is a relative term.

I hung up my spurs at 57 - never to enter a school again. :-) NO REGRETS

Again... RE is relative. I know somebody who worked as an engineer full time until 80. Went into the office every day and loved it.
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Old 04-09-2010, 01:51 PM   #12
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I know several people approaching 70 who are still working full time and they enjoy it (and it has nothing to do with needing the money). I also know people who wish they could retire but their circumstances have nothing to do with sitting on a beach drinking pina coladas, and they don't think working past 65 is the worst thing that could happen to them.

Man, I love pina coladas.
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Old 04-09-2010, 02:49 PM   #13
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FWIW, even if you consider this stat applying to the first boomers that today would be age 64 (not 65 quite yet, since it started in 1946), you have to realize that regardless of pre/post boomer age, the retirement scenerio has changed for most people when speaking about those in the non-union, private sector.

I/DW are 62, and up till our mid-30's we did not worry about saving/investing for retirement. Why? Because at that age we both were working in the private sector, and had defined benefit (pension) plans.

Both were eliminated and due to change of jobs and the laws at that time (vesting was at 10 years), we had no "carry over" from our previous jobs.

Unlike our parents/grandparents (who were older, and had pensions during their retirement), we got a late start in a world of IRA's and 401(k)'s which of little was known by the non-professional. There was quite a learning curve.

Unlike today, when somebody coming out of school is aware that they need to save/invest on their own (If they do? That's another story), our working lives were going fine till somebody hit the retirement "reset" button.

No doubt about it. Only through a radical LBYM lifestyle, along with a bit of luck allowed us to retire. Other family members and folks I formerly worked with did not.

I would say that anybody who works in the private sector and is able to retire in a good manner (I can't talk about any government related job, since that's not where I came from) is extremely lucky if they are older, or early boomers...
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Old 04-09-2010, 03:02 PM   #14
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No doubt about it. Only through a radical LBYM lifestyle, along with a bit of luck allowed us to retire. Other family members and folks I formerly worked with did not.
I don't know whether I was lucky or prescient, but as soon as I was eligible to participate in Megacorp 1's 401K plan, I started putting in the maximum allowed at the time (12% of income). And I've been doing that (or more) ever since, going on about 22 years now, plus Roth IRAs since 1998 and now an HSA. Today between the 401K, two Roth IRAs and my HSA, I'm setting aside close to 1/4 of my pre-tax income.

If I hadn't invested so heavily and aggressively in my 20s, there's no way I could think about retirement, let alone *early* retirement. When Megacorp 1 terminated my pension and potential retiree health insurance, I pretty much knew that my obsession laser focus on saving for retirement even in my early 20s was my lifeline to still being able to plan for a retirement. And then I thought about all the folks I worked with who were planning on retiring with the Megacorp pension, not saving much and realized their retirement goals were toast.
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Old 04-09-2010, 03:23 PM   #15
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From the article
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"Given the size of the baby-boom generation, if the shift toward later retirement persists it will mean added pressure on the entry of younger workers on the labor force," said Richard Curtin, director of the surveys, in a statement.
I don't know if this will be true in the long term. If nothing else, the past record of crystal gazers is enough to suggest that something else will happen. For example, there may be more part-time work. Older people have skills to do the jobs, but may not have the stamina to last a long day. Also, they may not need a full-time salary to meet their needs. I am not making this prediction - just pointing out that the article's conclusion may not be the only way to look at this.

I think parents play a huge role in determining if we pursue high compensation careers and live frugally. By the time we're ready for college, a lot of this is already determined.
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Old 04-09-2010, 03:28 PM   #16
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I wonder what kind of jobs those over 65 are getting. We have nobody who is over 60 working in my company currently (and these are the people who have been with the company for years), so I cannot imagine a 65 year old new hire...
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Old 04-09-2010, 03:31 PM   #17
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For example, there may be more part-time work. Older people have skills to do the jobs, but may not have the stamina to last a long day.
This is what I would predict, too -- "retirement" may increasingly be broken into a period of "semi-retirement" followed by a period of full retirement.

After all, if at some point in time people have had enough of their current full-time gig but their savings leave them (say) $8,000 a year short of what they need to retire, there's no reason why they have to stay with a job they really hate if they can pick up the $8K+ in part time work -- especially if the health insurance situation no longer tethers them to a full time j*b.

We may start seeing more people "semi-retire" to part time work at (say) age 55 or 60 and then fully retire at 70 or so. That could be the changing face of retirement. Assuming the age discrimination factor doesn't prevent it from happening, anyway.
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"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

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Old 04-09-2010, 03:49 PM   #18
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-- especially if the health insurance situation no longer tethers them to a full time j*b.
Good point on health insurance. We may see a surge in self-employment and entrepreneurship. I knew quite a few co-workers who continued to work only because they (or a family member) were uninsurable in the individual health insurance market. Some had ideas for small businesses that would provide niche products, but couldn't make the jump.
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Old 04-10-2010, 09:21 AM   #19
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I wonder what kind of jobs those over 65 are getting...
Pensioners arrested for planning Chicago bank robbery - Telegraph
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Old 04-10-2010, 10:44 AM   #20
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I think most people spend most of their lives in a consumerist haze generated by billions of dollars of advertising and hundreds of crappy but popular TV shows. By the time people wake up, it's too late to make much financial progress, since financial obligations have probably been run up to, or past, the level of earnings.

I'm usually one to hold people responsible for their lot, but in this case there are huge cultural forces working to keep people under-satisfied and over-spent.
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