Retirement is a unique experience, for better or worse.
Whether employees have successfully saved for decades, or been sidelined by financial hurdles that make the possibility of retirement now obsolete, each individual is on their own personal journey. That extends to their interests once they reach retirement, too: For some employees, picking up a side gig after leaving the workforce helps them pad their savings, while keeping their interests fresh, or even allowing them to find new ones.
Whether it’s swapping a nursing career for a gig playing music at a senior center, to a bookkeeper who now reports from the golf course, a few retirees shared how they’re spending their time and making extra money on the side. While often not enough to live on, these retirees prove there’s more to work than just the paycheck.
“I frequently teach my classes for free, as a service to my community and for my own gratification, as I love it,” says Carol Gee, a former teacher who shares her love of arts and crafts at the local library. “My creative outlets help me to exhale for a couple hours, several days a week.”
Some employees need more than just extra income — they need the opportunity to start saving to begin with. For BIPOC employees, that’s extra challenging, and many are feeling a financial pinch that’s more painful for them than other demographics in the workplace.
Regardless of age and income, Black and Hispanic workers are less likely to participate in their company 401(k) plans, according to research non-profit the Rand Corporation, and when they do contribute, they save at much lower rates than white workers. Black employees are also more likely to take a loan, according to a report by the Advisory Council on Employee Welfare and Pension Benefit Plans, and more than twice as likely to take a hardship withdrawal from their retirement savings. Employers need to pay closer attention to the struggles workers of color are currently facing, and prioritize helping them shore up their finances and be more prepared to weather a potentially worsening storm.
Once on track, employees can often stay the course with tools that support these habits, like auto-escalation of workplace 401(k) plans. This benefit is helping millennials in particular to have a sunnier outlook on their retirement, and they’re surpassing their boomer peers when it comes to retirement readiness, according to new research from Vanguard.
To measure readiness by generation, the study calculated how much of their pre-retirement income employees could “sustainably” replicate after they leave the workforce, using their retirement plans, Social Security and other resources. By that measure, Vanguard found that median-income “early millennials” — defined as those currently aged 37 to 41 — are on track to replace 58% of their pre-retirement earnings, while median-income “late boomers” — defined as those aged 61 to 65 — will only be able to regenerate 50%.
Of course, being financially prudent is a lifelong quest, and there are still challenges to maintaining financial health in older age. Complicating matters more is the struggle to maintain physical health, a task that’s expected to get even more expensive next year.
Premiums for Medicare Part D, which covers prescription drugs, will see a “dramatic” rise in 2024, according to a new research report by HealthView Services. In California, Florida, New York, Pennsylvania and Texas, seniors enrolled in Part D plans from three of the largest Medicare providers will see their premiums jump, on average, by 42% to 57%. Is the Inflation Reduction Act to blame?
