When Diane Weatherington retired in 2020 after a long career as a purchasing and contracting agent, she believed she had enough savings to enjoy a comfortable life, travel, and spend time with her six grandchildren. However, stuck at home in Altamonte Springs, Florida, during the COVID-19 pandemic, she sought ways to keep busy. Consulting for local government agencies led her to find part-time remote work.
As living expenses continued to climb, Weatherington found that although she couldn’t retire completely, she could manage daily needs and her biannual trips abroad. Now, though, those trips are on hold as she tries to make sense of the economic situation. “I was doing well financially in retirement until everything started going up, like home and car insurance, but now food and other costs are rising,” said Weatherington, who is 73. She added, “Luckily, it’s something I enjoy. But honestly, I might have to work for as long as I can to make ends meet.”
Weatherington is among a growing group of “non-retirees” who are extending their careers beyond the typical retirement age of 65. An AARP survey noted that one in ten retirees has exchanged leisurely pursuits for a full-time job, primarily driven by financial needs. Four in ten older Americans are either searching for work or returning to the workforce just to cover expenses.
“This really opened my eyes,” stated Carly Roszkowski, AARP’s vice president for financial resiliency programs. “It’s not merely about the fear of outliving retirement savings, but rather the reality of struggling to meet everyday costs right now.”
Challenges Facing Older Americans in Retirement
With people living longer and seeking connection and purpose, an increasing number of Americans are working well into their 60s and 70s. AARP reports that 38 million Americans over 55 are either employed or seeking work, a notable increase from two and a half times the number of seniors in the workforce four decades ago.
This significant shift in demographics means older adults now constitute nearly a quarter of the workforce. Economic pressures are contributing to the rise of non-retirees, Roszkowski explains. Historically, pensions and Social Security gave many the opportunity to retire without worries. But Social Security now often falls short of the average wage, and many older individuals lack sufficient savings or retirement accounts to cope with rising living costs.
According to the AARP survey, 7% of retirees have either stayed in or re-entered the workforce recently, with nearly half citing financial motivations. The desire to remain active follows closely behind at 14%. Research consistently points to income as the primary driver for retirees returning to work, even if the distinctions among reasons aren’t dramatically different.
The Impact of Rising Living Costs
T. Rowe Price estimates that 20% of retirees either work part-time or full-time while an additional 7% are searching for employment. Single retirees and women are more likely to mention finances as a key factor hindering their retirement plans. Angela Antonelli, director of the Center for Retirement Initiatives at Georgetown University, notes that many older Americans are living on the brink economically.
More than one in five households aged 65 and older depend on Social Security for over 90% of their income, and over half of those 55 or older have no retirement savings at all. “Older workers are the fastest-growing workforce demographic, but many aren’t working by choice,” Antonelli explained.
As living costs continue to increase, the safety net that once existed for retirees is fraying, according to Jeffrey Sanzenbacher from Boston University’s Retirement Research Center. He mentions that retirees concerned about paying for essentials like groceries and healthcare might feel compelled to find additional work or even abandon retirement altogether. However, with job availability declining and unemployment rising, Sanzenbacher warns that those forced to return to work may struggle to find new positions.
“Those who need to come out of retirement are usually the ones with minimal savings and little backup,” he remarked.
