Countless articles discuss how millennials are driving for ride-sharing companies such as Uber or Lyft, running errands on TaskRabbit, which helps users find people to perform miscellaneous tasks on demand, or using other gig economy startups to bring in extra cash. But with kids out of the house and careers ramping down in some cases, baby boomers are even likelier candidates to power the on-demand economy. One platform, Tengia, specializes in pairing people over age 65 with individuals and small businesses who need skills-based services.
[See: 10 Ways to Get Ready for Retirement After Age 50.]
In fact, a 2016 report analyzing trends in alternative work arrangements across America conducted by economists from Harvard and Princeton shows that the rise in the incidence of alternative work arrangements has been most dramatic among older workers ages 55 to 75. And it is worth noting that these alternative work arrangements encompass more than just gig economy startups.
“Like their parents, [boomers] fear living beyond their means or having their savings running out,” says Sally Abrahms, an aging expert. “This is a way to relieve that fear. I see it daily when I order something from Etsy or another company. Often the people I’m dealing with are baby boomer who were either laid off or want to make extra money, or they want to pursue their second or third career,” Abrahms explains.
Like their younger counterparts, boomers should consider some of the potential downsides of this new mode of work. “In the gig economy, you’re treated as an independent contractor not an employee, which denies you the legal protections and benefits you’d have as an employee,” Abrahms says. “Companies don’t have to pay contractors a minimum wage or make retirement contributions. There’s no vacation pay or health benefits or workers’ comp coverage.” (Of course, some boomers may have health insurance through Medicare or a working spouse.)
Boomers who have amassed significant assets such as a home may also want to weigh their desire for extra income against the potential liability. “Let’s say you rent out your house, it may be a violation of the terms of your mortgage,”Abrahms says. Or if you’re a rideshare driver, consider whether you’re in violation of your auto insurance policy.
Those caveats aside, U.S. News talked to several boomers about their motivations for getting into the gig economy.
Extra income. This is the most obvious reason to participate in the gig economy. Many boomers who have chosen to retire or perhaps found themselves involuntarily retired due to a layoff want extra cash to supplement retirement savings and Social Security while they’re still young and healthy enough to earn. That was the case for Tom Miller, who began working for TaskRabbit in San Francisco in September 2013. Miller retired from the city library system after 20 years and needed extra income. “My daughter’s going to college, and it’s not cheap living in this area,” he explains.
Miller has performed a variety of tasks, including researching architectural summer programs for a user’s middle school daughter and writing a retirement speech with 15 Beatles songs interspersed. Miller estimates that he works five to 10 hours a week, but he appreciates getting a little extra income to pad his budget.
[See: 10 Foolproof Ways to Reach Your Money Goals.]
Motivation to move. After Walt Galvin retired from manufacturing operations in early 2015, he says he had too much time on his hands. “My wife would come home from work and say ‘What did you do today?'” he explains. “It got to the point where she said, ‘You really need to get off the couch,'” he recalls.
Galvin, who lives in the Washington, District of Columbia metro area, has always loved dogs. Earlier this year, he signed up as a dog walker with Rover, an app that lets walkers set their rates and choose their hours. “I am walking between five and six miles Monday through Friday,” Galvin says. “I’ve lost a few pounds, and I think my overall health has improved by getting that daily exercise,” he adds.
Flexibility. For baby boomers who want the flexibility to travel, tend to family obligations or take time off for other reasons as needed, traditional employment may not fit the bill. Raymond Patterson, a Los Angeles-based performer, signed up with grocery shopping and delivery service Instacart in July 2014. His gigs had slowed down, and he heard about the new service through the Actors Fund, a human services organization for actors and other entertainers.
Patterson works 40 to 45 hours in a typical week but likes the flexibility to take time off for appointments or performing gigs as needed. “We do have a set schedule, but we can make adjustments in our schedule in advance,” he says. “If a booking occurs, I arrange my time and I come back to [Instacart],” he adds.
Social interaction. Whether driving for a rideshare app, renting out a spare room or assembling furniture, the opportunity to meet new people outside their immediate circle is another draw for boomers. “I think there is a huge social aspect to the gig economy for boomers,” Abrahms says. “It’s a way to meet people at a time of life that can be isolating. Yes, they’re … doing it for the money but also for this social connectedness — this part of feeling like you’re in the world,” Abrahms adds.
This resonates with Patterson. “The income from it is terrific, and I also I like the service component of it,” he says. “Since I’ve been doing it, I love meeting the interesting people that I actually shop for and then subsequently wind up delivering to. I’m especially touched when I go to an elderly person’s home who may even be homebound,” he adds.
[See: How to Save for Retirement on Less Than $40,000 Per Year.]
Purpose. Many people volunteer in retirement or pick up a new hobby because they miss the sense of purpose and identity their job once gave them. “The money is critical, but it’s also a way to stay connected with the world, meet interesting people and feel like you have a purpose,” Abrahms says.
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Why Baby Boomers Are Getting Into the Gig Economy originally appeared on usnews.com
