As inflation has risen in recent years, many seniors living on a fixed income have found themselves in a difficult financial situation, leading them to “unretire” and reenter the workforce.
The increasing cost of living — driven by higher prices for basic essentials such as food, housing and health care — has eroded their purchasing power, researchers said.
“The playbook has completely changed,” said John Farrell, one of the leaders of the senior care website Caring.com. “When you’re looking at the whole picture here, it’s a stark reality for seniors in terms of their financial outlook.”
According to a survey commissioned by Caring.com, one in three seniors are currently working a full-time or part-time job.
Out of those working seniors, one in three said they had previously retired but made the tough decision to unretire and return to the workforce.
For many retirees, savings and investments may not be adequate to cover their daily expenses any longer.
“If they retired in the year 2000, the senior that would have retired in that year would have seen about 36% of their purchasing power erode in the 24 years since,” Farrell said.
Inflation and cost-of-living increases were the largest reason seniors are returning to the workforce, the study found, with 52% citing inflation as the most significant factor in their decision to return. Paying off medical debt or other debts were also among the top motivating factors.
“Retirement plans for many seniors have been impacted by inflation — both due to a desired timeline for retirement and a less clear template for success with their investments amid inflation’s impact,” Farrell said.
Almost half of working seniors don’t plan on retiring in the next five years, according to the survey.
The results were based on a survey from June of 1,500 seniors between the ages of 62 and 85. It has a margin of error of plus or minus three percentage points.
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