By Anne Tergesen
The recession is officially over, but many older Americans will feel its effects for years to come—and a portion may never recover.
Those are the bleak findings of a new survey from AARP, which polled 5000 Americans age 50 or older last October. According to the survey, which was released today, a large portion of that population—some 83%–predict they will have a harder time taking “care of their financial needs in retirement” as a result of the recession.
Moreover, there were signs that a significant minority are already experiencing acute distress:
- Almost 25% said they had exhausted all of their savings during the recession.
- 12.4% said they had lost their health insurance.
Others have been forced to make financial decisions that—while necessary in the short-term—could result in a permanently lower standard-of-living. For example, 13.5% of respondents said they started to collect Social Security benefits during the recession. But almost 70% of them took their benefits sooner than planned. (When it comes to Social Security, the longer you wait to collect, the higher your monthly checks will be.)
“Older Americans have good reason to be worried about the future,” John Rother, AARP’s Executive Vice President for Policy, Strategy and International Affairs, said in a press release. “They have less time than others to recover from the impact of the last three years.”
The survey also revealed that respondents are taking steps to bolster their retirement security:
- 44.1% said they will seek part-time work in retirement.
- 33.4% said they plan to delay retirement.
- 38.7% said they are paying down debt.
- 35% said they are saving more.
- 35.4% said they have shifted their financial assets into less risky investments.
To find out if your retirement plans are realistic, click here. Other useful online calculators include Fidelity’s Retirement Quick Check and T. Rowe Price’s Retirement Income Calculator. Fidelity’s Retirement Income Planner can provide a more detailed analysis of your retirement income and spending needs. This program, which provides the option of hand holding from an adviser, is free. But it may take you a few hours to complete. (Other financial services companies have similar offerings, but to access them, some require that you have money in their mutual funds.)