Retirement And The Recession: Savings Destroyed For One Out Of Four Older Workers, Says AARP Survey

WASHINGTON -- Workers older than 50 are gloomy about retirement after getting beat up by the Great Recession, according to a survey released Tuesday by AARP's Public Policy Institute.

During the course of the economic downturn that started in December 2007 and technically ended in June 2009, one in four older workers burned through all of his or her retirement savings, the survey found.

More than half of older workers weren't confident they'd have enough money to live comfortably in retirement, and nearly half said they expected a "less economically secure" retirement than their parents had.

"Many older Americans have been buffeted by skyrocketing health care costs, dwindling home values, shrinking pension and investment portfolios, and employment struggles," AARP executive John Rother said in a statement. "Even if you have a job, this survey demonstrates that you are not immune to the negative effects of the recession."

Even though the unemployment rate for older workers is much lower than for their younger counterparts, 12.4 percent of the 50-plus cohort told AARP they lost their health insurance, 49.5 percent said they delayed medical or dental care because of financial troubles and 13.5 percent said they started to collect Social Security retirement benefits earlier than they'd previously planned.

Take, for example, the case of a 63-year-old tutor, who said she'd been laid off in June 2010 by a private teaching company. The woman, who lives in southern California, asked for anonymity because she feared revealing her name would be "deadly, deadly" for her job search.

The former tutor told HuffPost she opted for early Social Security retirement benefits in January after a fruitless six-month job hunt. Since she opted for benefits before her full retirement age -- which would have been at 66 years old -- she received only 80 percent of her full benefit, which she said amounts to $857 a month. It covers rent, she said, but doesn't leave much for food.

"I eat a lot of apples, bananas, rice, and pasta," the woman said, adding that she tends a garden with tomatoes, cucumbers and cantaloupes.

Laid off older workers have a tougher time than most age groups finding new work. The average jobless spell for workers 55 and up lasts longer than a year, and older workers who lose long-held jobs are much less likely to find new work than younger workers.

Click HERE to download a PDF copy of AARP's survey.

Comments

[Kachina Lively]

09:06 PM on 05/26/2011

Those responsible must be held accountable!

[spinotter11]

09:02 AM on 05/27/2011

What are the chances of that? They outfoxed us and we have to live with it. I just hope we don't let it happen again.

[Scent]

10:21 AM on 05/26/2011

Sorry, but are we STILL this stupid?

These saving were not destroyed. They did not magically vanish and they did not evaporate.

They were transferred. The money is still there. Money does not vanish. But now it belongs to ...

... guess who?

---

The ones who just got a multi billion dollar tax break.

[enkelin]

06:33 PM on 05/26/2011

Actually not true. If they had their money in the stock market it DID simply vanish. Stock values are NOT a zero sum game. If they were, then the market would never go up. that includes pensions which are invested in the stock market. If I buy a stock at its IPO 10 dollars and sell it to John at 50 and he sells it to Sue at 75. NO one has lost any money. Just ask investors of Apple computer of Google. When a stock collapses it is only the last owner of the share who has lost value and only that amount which is lower than what he has bought it at. Some people have original shares of 100 year old companies. It would be hard for them to lose money on those shares. I hold some shares of a stock which now trades at 8 times the money I paid for it. The market would have to totally collapse for me to lose on those shares.

[RRoadrunner]

09:23 AM on 05/26/2011

I asked a serious question yesterday:

Can anyone give me a coherent explanation on how Obama, Reid and Pelosi brought down this economy? A simple question. Just give me facts, not ideology.

[Scent]

10:23 AM on 05/26/2011

What You write IS ideology. And it completely ignores facts.

The economy was brought down by those who STARTED the slide into the sewage pit. Not by the ones who try to slow the descent while the ones who started it do everything in their power to shove our faces deeper into the feces.

[spinotter11]

09:04 AM on 05/27/2011

You are not naming any of the people responsible for tanking the economy. If you want information, please ask the proper question, viz. "Who is responsible for bringing down this economy?" The way you ask the question shows us that you have your own agenda, and it isn't the quest for truth.

[blueken]

08:27 AM on 05/26/2011

This is a learning moment. First I guess is, don't count on Wall Street to fund your retirement. Wall Street is about fees. Win, lose or draw, they take theirs off the top. Not much of a safety net. So maybe paying a little more in taxes ain't such a bad idea if it allows us to fund SS and Medicare into the future. A future in which we all get old. Yes, you should put away as much as you can towards retirement, but you can't count on it. Also as you get north of 50, your investment balance should get a lot more conservative. That's what I did, and so far so good. My only fear is that the GOP in an effort to screw up the economy enough to get control of Wasington, will push bonds into insolvency. I'm more worried about bonds defaulting than rising interest rates. Rising interest rates on bonds will decrease my redemption value, but slowly increase my earnings.

[Reno Fickler]

11:55 PM on 05/25/2011

The money the 2%ers keep amassing has to come from somewhere. Their gains equal our losses. The deregulations that began 30 years ago virtually guaranteed this would happen.
We all just sat and watched as the systemic looting of America took place.

[blueken]

08:27 AM on 05/26/2011

You got that right. There is only so much pie and our slice gets smaller all the time.

[enkelin]

06:43 PM on 05/26/2011

US Corporations are making RECORD profits. They are making billions manufacturing OUTSIDE the USA and SELLING INSIDE the USA. The 2%ers are the executives of these companies, the fundmanagers who trade in these companies, and the large shareholders of these companies. They dont employ Americans anymore to share the wealth. They dont have to, they can pay chinese 25 cents and hour to do the work. THAT is where all the money is coming from.

[cbwHouston]

11:14 PM on 05/25/2011

Wall Street had an anti-regulatory acquiescing president [George W. Bush] and “hand-offs-Wall-Street” regulators which facilitated all the “casino gambling” with retiree’s pension funds.

In the wake, the economic fall-out of Wall Streets’ excess and financial malfeasance precipitated the worst-ever recession in American history. Mass layoffs and spiraling retirement savings altered the national mood [a deep and abiding malaise set in].

And today the American Middle Class… yet being manipulated by Wall Street speculators and Republican lobbyists, is yet reeling from the economic fall-out. While Wall Street… regretfully the beneficiaries of a $780-billion prerequisite bailout to stave off any further pension funds and 401K hemorrhaging, today are experiencing something akin to a gilded-age renaissance.

Wall Street now is hedging their 2012 bets on Democrats loosing control of the U.S. Senate [The Dodd-Franks Wall Street Reform bill and Elizabeth Warren overseen Consumer Protection Agency being axed], in order to once again disappear from the regulatory sphere... a conspicuous absence which precipitated the 2008 Financial Markets crash?

HBO is airing New York Times “Deal/Book” columnist Andrew Ross-Sorkin novel “Too Big To Fail” movie adaptation… basically regaling, glorifying, sensationalizing an episode in American history which nearly destroyed Middle America And Main-Street.

Wall Street is clearly “Not to Big to Fail,” however the American Middle Class and Main-Street small businesses are not… yet as this article proves the very least and last to recover.

[nopilikia]

12:01 AM on 05/26/2011

Add insult to injury Wall Street's "illegal gambling" with OPM (other peoples money) is still going on.........congress failed to eliminate the exemption from state's "Bucket Shop Laws" that was passed as part of the 1999 Gramm-Leach-Bliley Act of 1999. So much of all that "tough" banking reform.

[cbwHouston]

01:21 AM on 05/26/2011

nopilikia:

Should be required reading. I simply had no idea. Posting certainly worthy of a little research. Peace. Happy Thursday.

[fortressfountain]

09:30 PM on 05/25/2011

Letmesee-I should sacrifice for both the older and the young? What is in it for me? Low wage jobs without benefits? Does not sound too inticing to me.

[landskroon]

04:55 PM on 05/25/2011

If you can trace Osama Bin Laden, a skinny Arab of 5 foot 6 in a far away country, tell me, would it be so difficult to find zillions that disappeared in America? I could give you a hint, it is not in the pockets of the people that live in the many American Box-towns. It might be found in banks and houses above a few millions? Or on names of Americans that have far-away accounts on tiny islands

[Judith Martin]

04:05 PM on 05/25/2011

What people should be thinking of is that over the next 20 years, all the Baby Boom generation is going to be entering retirement, like the "watermelon going through a boa constrictor". If we can no longer fend for ourselves, and our families -- children, cousins, or anyone remotely connected -- will not take us in, what is going to happen to us?

[TruelyFedUp]

06:38 PM on 05/25/2011

It is not just older people suffering this. This is what we are doing about it http://directory.ic.org/23400/Essers_Peace___Dancing_in_the_Light

The people need to get together to fix this. Share resources, grow your own vegetables, live sustainably.

And remember Missouri loves company...

[nosmiley]

06:01 AM on 05/30/2011

Another way we need to get together is to smarten up about politics. To get it fixed it'll take something ugly, like when we got "upset" by having our tea taxed. Or that group that decided slavery was a bad idea. ( yes it's a bad idea, but the guys talking about it weren't counting on tens of thousands of Americans getting killed over it. ) It was supposed to be another of Cheney's cakewalks.

[enkelin]

07:05 PM on 05/26/2011

Better stake out your spot under the viaduct.

[expat50]

04:04 PM on 05/25/2011

If seniors had only bet against the USA like Wall Street did they would be fine right now.

[RRoadrunner]

04:01 PM on 05/25/2011

I’ve read a few Obama, Reid and Pelosi remarks. I would really like a coherent explanation on what they did to bring down the economy.

I am in my late fifties and was able to limit my losses out of pure luck. Two weeks of “troubled assets” and “banking troubles” convinced me to pull out of the market. I am now back to where I was before the crash and feel lucky. My investment window has closed but I should be ok but not where I wanted to be.

From my perspective we been living on borrowed time for a while. Since the 80’s we’ve been investing from bubble to bubble making money and losing it between each one. The true return on investment since the 80’s is probably 2 – 3 percent.

The blame game:
Both political parties (lack of regulations).
Wall Street for inflating the value of our investments
Businesses who figured out a way to avoid pensions.
401k Pension plans. They are a huge unregulated black box. What was their role? They collect billions in fees for allowing them the privilege of playing with our money. How much did they lose in all of this?

It’s a nasty situation we’re in with no way out since time is not on our side…..

[depserv3a]

06:35 PM on 05/25/2011

The question you ask in your first sentence can be answered by a very good by Dr. Thomas Sowell titled "The Housing Boom and Bust." It explains how Fannie Mae, along with other socialist programs supported by the politicians you mention, led to the crash.

[enkelin]

07:10 PM on 05/26/2011

Well if that is what the DR. says he is wrong too. There were not enough subprime mortgages (14 trillion total mortgages in us) in the entire USA to cause the damages done in 2008 to the entire world banking system (70 Trillion lost worldwide). Better try next time. TRY Deregulated Derivatives at the rate of 40 to 1 on sometimes NO ASSETS at all as a basis. Those were called SYNTHETIC CDOs. Really dont take the simplistic excuses the right dreams up so that the public dosent get wise to their frauds.

[nosmiley]

06:07 AM on 05/30/2011

Yea, we wouldn't dare want to include Reagan's getting the "Guvment off our backs", deregulating the banks, or the Bush's and Clinton doing more of the same. Why anyone is so naive to believe that Bankers will "police themselves" is beyond me.
The folks running the stock market are the same type people. The got the deregulators to look the other way., and the oil companies took all the fed inspectors on vacations. Remember that thing in the gulf.

[TruelyFedUp]

06:40 PM on 05/25/2011

We have found a way out http://directory.ic.org/23400/Essers_Peace___Dancing_in_the_Light

We need thousands of these throughout the country. Then we can all visit each other.

Rememnber Missouri loves company...

[invirginia]

03:50 PM on 05/25/2011

Am planning to do the same thing as the AZ couple. Just applied for new insurance today; am certain I will get rejected for pre-existing condition. Then dropped my $600 per mo/$5K deductible insurance for six months to apply for better coverage through PCIP at less than half the premium cost with a $1500 deductible.

[maxandmurray]

03:35 PM on 05/25/2011

WAKE UP and smell the roses, Americans !!

The guilty party is not the Democrats and it is not the Republicans......IT IS ALL OF THEM, ALL POLITICIANS.

As long as both parties keep you and I fighting over "whose fault it is" .... we all direct the attention of of them and their corruption. Both parties have their hands in our pockets and their hands open-faced and out to the lobbyists, corporations, bankers and swindlers of our tax monies.

This CRISIS is a direct result of political incompetency, corruption and self-serving representatives of the people.

VOTE THEM ALL OUT, regardless of their affiliation. We need to replace our congressmen with every-day Americans who are willing to serve the people, not themselves and not their party.

We had our retirement planned out, having worked 40 plus years and saved.....the majority of it is gone. The value of our home is drastically reduced and the cost of living has drastically increased.

While Obama plays ping pong, people are dying in Joplin. While Congress holds Kangaroo Court scolding the bankers, our pocket books are being picked......all with Washington's blessings.

If Washington CARED, there would have been a BAILOUT for pensions for all Americans....instead it is Bankers and Wall Street. WAKE UP...vote them all OUT.

[bigkay]

10:46 PM on 05/25/2011

The only way we can have politicians that vote in the interest of their constituency and country
is to take the dirty money out of politics. I have no idea how that can be done.
I dread the 2012 campaigns, millions, billions of dollars wasted on political ads that are smoke and mirrors.

[spinotter11]

07:01 AM on 05/26/2011

I agree with you about dreading 2012, but you don't have to listen. Turn off your television.

[nosmiley]

06:14 AM on 05/30/2011

You failed to mention what goes on in the federal reserve bank. 99 % of Americans have no clue to what's going on there. If they did, and were willing to act, then you would see everyone getting voted out.
Over a hundred years ago, a guy named Rothchild said if he could control a nation's currency, he didn't care who was president , or King, or Queen. Hint, Hint. that family headquartered in Europe, owns "shares" of the Federal reserve bank. Rather than telling me I'm nuts, spend 30 minutes on the internet readingf about it. You choose where you start. You'll find that our govt is run by a number of European families.

[anonymous67]

03:06 PM on 05/25/2011

America no longer has a financial system that serves the country -- rather it has enslaved us.

[h23154]

03:45 PM on 05/25/2011

Really? How are you "enslaved?" Put your money under the mattress or in to an insured savings account if you want guaranteed safety.

[enkelin]

07:17 PM on 05/26/2011

Damn those socialist Democrats who instituted FDIC back in the 30's to insure small depositors. Maybe the Republican Objectivists can eliminate that program as well.

[SeanN]

04:15 PM on 05/25/2011

You're right - they define their interests very narrowly, pursue them aggressively, and bleed the rest of the country with high fees and self-serving schemes. Want to know how to kick them in the teeth? Only bank and invest with the not-for-profit part of the financial services industry - bank with a credit union, and do your investing directly (no broker, etc.) with Vanguard or TIAA-CREF. The only way they will be put in their place is if the middle class refuses to play their game any longer.

[enkelin]

07:18 PM on 05/26/2011

Vanguard? You have got to be kidding. They are in on this as well.

[LawTalkingGuy]

01:58 PM on 05/25/2011

Those old suckers just got taken by savvy bankers. Don't cry, it's the American Way. And it will remain the American Way until voters demand politicians work to solve the real problems.

[depserv3a]

05:25 PM on 05/25/2011

We need courageous progressive heroes like Barnie Frank and Chris Dodd to keep watch over those savvy bankers. Wait a minute, we've already tried that...

[LawTalkingGuy]

06:55 PM on 05/25/2011

No, we DIDN'T try that, and we had the recession.

Do you just invent history to suit you, or do you lack a linear understanding of what we call 'time'?

[LawTalkingGuy]

08:23 PM on 05/27/2011

"(I couldn't respond because there wasn't a reply button on your post.)"
There's a limit on the length of strings. You can go back, like I'm doing now.

"I earned a living as a union tradesman for many years... During most of the reign of Bush Jr. we had more work than we could man... That's all changed now. You can blame Bush and deregulati­on if you want, but I think Obama had something to do with it."

Don't just think, say. In what way do you think Obama's policies have had something to do with it. What is the 'it' you speak of? Your personal work as a shop steward? How could that have anything to do with the President, or anything to do with our discussion since i have no idea what you do for a living? you need to fill in those blanks, otherwise you just sound like you're saying "boo hoo, I blame the current president for all my problems even if they have nothing to do with him or his policies." WHY do you think he has something to do with it??

"America is not a democracy and never was. America is a republic"

Can you tell me the difference? Do you hate democracy? Do you love Republics? Why? Do you even know the difference? What is it? Please, say something meaningful instead of just throwing up talking points.