For most seniors in the U.S. life is good, according to a recent poll of 2,250 older adults. Whether they move to “active adult” communities such as Sun City or grow old in the homes where they raised their children, they say they are pretty darn content.
USA TODAY partnered with UnitedHealthcare and the National Council on Aging to gauge the attitudes of Americans age 60 and above. The telephone poll shows that most are enjoying their golden years, in stark contrast with a more somber national mood.
The economy remains shaky, unemployment stubbornly high, the housing market stalled and the stock market volatile, but older Americans say they’re generally happy with their lots in life. Most are content with their finances, their health and where they live, and most are optimistic about the years to come.
Why are seniors so upbeat when many other Americans are not in a very happy place?
“People in retirement have dodged a bullet,” says William Frey, demographer at the Brookings Institution. “They’ve gotten to the promised land in time to avoid all the bad stuff.”
This generation of retirees, including the oldest Baby Boomers, who turn 66 this year, are more likely to enjoy the fruits of their life-long labors than future retirees, Frey says. They stopped working before employers pulled the plug on pension plans, before companies stopped matching contributions to 401(k)s and before Social Security and Medicare finances hit the crisis stage.
“I think the era of broad prosperity for American seniors will end with the first wave of Baby Boomers, now entering their 60s,” Frey says. “Times are tougher for their later Boomer brothers and sisters who entered the labor and housing markets in the late 1970s during tougher economic times.”
So who can blame the Serrans for feeling good about retirement? Both receive pensions — Dottie from years of working at the West Babylon, N.Y., library and Ralph from his New York City sanitation job. They moved from Long Island five years ago to be closer to two children and four grandchildren who settled nearby.
“We got out just in time and by the skin of our teeth,” she says. “We got a very good price for our house in Babylon. After that, it just plummeted.”
Yes, they took a bath in the stock market, “but not as badly as some people,” Dottie says. “We kind of knew the tide was turning, and we got out.”
The oldest Americans now are the wealthiest. Data from the Federal Reserve Board show that in 2010, households headed by people age 75 and above had the highest median net worth at $216,800 (half were worth more, half less). It was the first time they ranked at the top since the Survey of Consumer Finances began, in its current form, in 1989.
In 2007, the survey showed that those ages 55 to 64 had the highest net worth at $266,200, but that fell 33% three years later ($179,400).
Younger people were hit even harder: Those between 35 and 44 lost most of their net worth between 2007 and 2010, according to demographer Cheryl Russell’s American Consumers Newsletter. Their median net worth tumbled 54% to $42,100 after adjusting for inflation. Those under 35 lost 25%, to $9,300.
“The battering has been unequal across the ages,” says Ken Dychtwald, gerontologist, author and CEO of Age Wave, a consulting company that specializes in issues about aging. “As it turns out, if you were in your 60s and early 70s, you weren’t really affected. If you’re benefiting from Medicare, you’re covered. More than half of people over the age of 60 live in homes that have been paid off.”
What older Americans think
Most striking about the poll are the high levels of optimism and satisfaction expressed by the respondents — a tone that surprised even Nick Crofoot, vice president of Penn Schoen Berland, the Washington, D.C., market research firm that conducted it.
“There is a disconnect between attitudes and reality,” he says. “Nobody wants to believe that things are going to get worse for them. … What that says is that seniors aren’t as aware as they could be of some of the health challenges they face.”
The poll shows lower-income residents certainly are less upbeat: 22% of those who live on $30,000 or less a year say the housing options available to them are unaffordable, compared with 7% who make $75,000 or more. And they’re much less confident they’ll be able to afford their Medicare premiums, deductibles and co-payments in the future.
Some of the findings:
•Nearly two-thirds say the past year has been normal or better than normal.
•75% of seniors in their 60s expect their quality of life to get better or stay the same over the next five to 10 years.
•More than 60% say it’s easy for them to cover their monthly living expenses. If an unexpected expense were to occur, 71% are confident they could pay it.
•More than two-thirds are confident their finances will last through their retirement years, but almost a third are not confident in their ability to afford long-term care. Only 8% have no financial plan.
•Eighty-five percent are confident they’ll be able to stay in their homes over the next five to 10 years without any significant modifications.
“We live in a society where we’re led to believe young people are happy, content, resilient, fun and cool, and once you reach 60, all of that evaporates and you become unhappy, sick,” Dychtwald says. “That’s simply wrong. It’s a misperception, a misunderstanding and profound misrepresentation. … Turns out, young people these days are the most anxious, most depressed, and the 60-76 are the most resilient, most financially protected.”
Because of medical breakthroughs, people are living longer, turning old age into a moving target. When Social Security started paying monthly benefits in 1940, fewer than 60% of adults survived until age 65, and those who did lived 13 more years on average. Now, those born in 1960 or later will have to wait until they’re 67, but about 80% survive until age 65 and live an extra 14 years.
The poll shows that staying active and engaged in the community is a top priority. About a fourth work full time or part time; 76% of them say they work because they want to stay active and productive and 40% because they need the benefits.
Brenda Farkas, 71, has been working as a full-time skating coach since she was 18. There was no way she could stop working when she moved from New Jersey to Fort Mill, S.C., with her husband, Michael, 69.
“I probably never thought I’d retire,” she says. “I worked six days a week from 6 in the morning. To me, who likes to work, I was so bored (without it). Incredibly bored.”
So she’s back teaching young and old at the Pineville Ice House, just over the state line in North Carolina, for a few hours a couple of days a week.
“You know what? It’s my identity,” Farkas says.
When she’s not teaching, she’s jogging — 3.4 miles a day, six days a week.
The last wave?
The next wave of retirees will be entering a different world.
If there are no medical breakthroughs — finding cures for diseases such as Alzheimer’s and cancer — that could keep the cost of aging down; if people continue to retire in their early 60s; and if the influx of young immigrants who can support older populations slows dramatically, then “the next generation of retirees is heading for a rough ride,” Dychtwald says. “Many of them will not have the financial resources to retire either on time or even at all.”
Despite this generational shift, experts say the politics hasn’t caught up with the demographic realities facing this country.
“Politicians are still favoring the early Boomer wave, keeping government support for Social Security and health care untouched for those aged 55-plus, which leaves out the last chunk of Boomers,” Frey says. “When they become seniors, they will once again be pulling up the rear.”
As the federal government battles to bring deficit spending under control, pressure will likely grow to pull back on Social Security and Medicare benefits.
But another scenario might unfold that would upend this gloomy forecast: Medical discoveries eliminate or keep diseases such as Alzheimer’s and cancer at bay, lifting a big burden of aging; and employers retrain workers and create more flexible work schedules that make it possible and even enjoyable for large numbers of people to work into their late 60s and beyond.
“I don’t think we’re headed for doom and gloom,” Dychtwald says. “In the future, older people are going to want their health and a blended life of some work, some leisure and some volunteer contribution. Rather than viewing that as a penalty, people will view that as a way to live in future years.”
The evolution of retirement
Retirement has taken on different meanings over time. For centuries, there was no such stage of life. People worked until they died. Beginning in the 1930s, when Social Security was created, retirement became a time to literally withdraw.
Then in the 1970s, “retirement 3.0 began and all of a sudden, there were Sun Cities, cruises and they became the ‘golden’ years,” Dychtwald says. “I think retirement 4.0 is emerging. People like to stay youthful longer … reinvent themselves, and they will want to work longer.”
That doesn’t necessarily put Dottie Serran’s mind at ease. She thinks of what her son and daughter, both in their 40s, will face when they reach old age.
“Now there are so many big companies that are really not giving any pensions,” she says. “It’s terrible what people have to pay for health insurance. … That scares me, that really scares me.”
Via USA Today