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Younger Retirees Have Different Issues

Author: Helen Dennis, Specialist on Aging

Question: As a young retiree (56 years old and female) I am at a point of considering which way to go in my life.  Can you address some of the issues of being a young retiree?  We don’t exactly fit in with a lot of retiree and senior-citizen groups, but we do have things in common.  Thank you for the information.        

Answer: You have raised a rarely asked question, reminding us that retirement trends are broad based.  When we speak of trends, averages and norms, it is easy to assume we all are typical.    Not true – each of us is a case of one.

Your situation is more unique than prevalent.  In general, Americans are working longer with an increasing number of those 65 and older working full time.  Many have given up looking for work, they often are referred to as “discouraged workers”- and typically are not counted in national unemployment statistics.

Early retirement decisions usually are based on one or more of the following situations:  poor health, affordability, an early retirement package that cannot be refused, wanting to do something different, or an organizational change that suggests termination or retirement.

Early retiree concerns may relate to the reason for the early retirement.  For example, poor health is a worry unto itself; having to leave unexpectedly can leave one without something meaningful to do.

Let’s discuss some commonalities and differences. Lack of retirement savings is a big problem that may affect early and normal retirement.  This would be particularly true if an employee took early retirement with a “tin” rather than golden handshake.  Add to that a 30 percent loss in retirement investments and savings, and finances becomes an issue, regardless of when one retires.

The Employment Benefit Research Institute reports that about one-third of those 55 and older have saved $25,000 or less for retirement; 30 percent have save less than $10,000.

One difference between younger and older retirees is that younger retirees have more time to recover losses.

Here is another difference.  At 56, you are younger than the average retiree.   According to the January 2008 Monthly Labor Review, the average retirement age from 2000 to 2005, based on Social Security data, was 62 for men and women.

According to The National Academy on an Aging Society, young retirees enjoy certain aspects of retirement, but also have concerns.  They worry about finances.  They worry about becoming ill and not having enough money to cover medical expenses.  They also report feeling useless, missing co-workers and becoming bored.  Note that these concerns also have been expressed by those taking retirement at typical retirement ages.

Perhaps one of the most distinctive concerns of early retirees compared to those retiring later is availability of friends.  Most people are still working in their mid-50s.  That means friends may not be available to share the daily joys of retirement.

One way to find young retirees or peers is to visit active adult communities. And what is an active adult?  The Housing for Older Persons Act, enacted in 1995, defines an “active adult” as someone between the ages of 55 and 64.

Del Webb has been the pioneer in building active retirement communities, beginning with the first one in 1960 in Sun City, Arizona.

Marc Freedman in his book “Prime Time: How Boomers will Revolutionize Retirement and Transform America” (Public Affairs, 2002) writes that the opening of the Del Webb community marked an important turning point in the history of aging in this country – “one in which a leisured lifestyle ascended to the ideal for success in later life.  Older adults emerged as this country’s mass leisure class.”

Today, older adults as the leisure class might be history.  And not all midlife and older adults perceive their retirement as a period of leisure.  According to Freedman, many are looking for a life that still matters.

© Helen Dennis 2010, all rights reserved.

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