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Diane, who asked that her surname not be used to protect her privacy, said that before 2019, she ran a small business focused on learning and development, through which she was able to earn enough money to cover her daily living expenses.
But when the pandemic hit, she was forced to close her business and was unable to find a source of income for nearly two years. Her husband’s salary was not enough to support them both, so she was forced to withdraw money from her 401(k) and savings accounts.
Now, Diane has no savings and plans to retire in less than two years, but her situation doesn’t look like it’s going to get any better. (Business Insider has reviewed Diane’s filings and corroborated this information.)
“I’ve just left a contract job and I have no savings,” Diane told BI. “I’m someone who’s done really well up until now so it’s really disheartening as I have no idea what’s going to happen when I retire. My husband and I are a year and a half away from retirement age but we have no money and I think we’ll probably have to work until we die.”
Diane is part of the “peak baby boomer” generation — those born between 1959 and 1964 who will turn 65 this year. According to a recent report by the Lifetime Income Alliance’s Retirement Income Institute, this group includes more than 30 million baby boomers, making them the “largest and last” generation to reach retirement.
According to the report, 52.5% of peak baby boomers have assets under $250,000, which means they may have to dip into their savings and rely on Social Security benefits to get by in retirement. But Diane estimates that the roughly $1,800 she receives a month from Social Security won’t cover rent, groceries and prescription costs, and she’ll have to keep working to supplement her benefits.
“Simple math,” she says, “you’re going to need at least $4,000 a month to live on in retirement, and Social Security alone isn’t going to cover that.”
Many older Americans are dealing with the same problem: More than half of Americans over 65 make less than $30,000 a year, according to the Census Bureau’s most recent population survey, and would likely not be able to survive on Social Security alone.
And the Social Security Fund dry Unless lawmakers intervene by the late 2030s, Diane is “very scared” about her future.
“The expenses are huge,” she says. “To be a contractor, you need internet. You need a cell phone. You need an office. You can deduct the office on your taxes, but for now, these are expenses that you have to pay.”
“Everyone my age is a little worried right now.”
Diane has many years of work experience, but has not been able to find a full-time job despite applying for dozens of jobs: the full-time jobs she has seen are all too physically demanding, such as working in a grocery store, and she cannot do them.
She said many of her contemporaries are struggling with the same dilemma: either unable to find work in a field they’re suited for or forced to take low-paying entry-level jobs.
“The only companies hiring older people right now are companies like Home Depot and Walmart,” Diane says. “I tell my friends, as a cautionary tale: If you’re my age and you’ve got a job, keep it, because no one’s going to hire you.”
According to a survey in October post According to AARP, “age discrimination often prevents older workers from obtaining employment at or above their current employment level,” the organization also noted in its September survey findings. investigation A Harris Poll found that 60% of recruiters prefer to hire older candidates over younger ones for entry-level positions because older candidates tend to be more trustworthy.
Yet entry-level jobs are low-paying and sometimes physically demanding, making them often not an option for people nearing retirement. AARP recently released the results of a January survey that revealed that one in five seniors has no retirement savings, and more than half believe they don’t have enough money to get through retirement.
“Everyone my age is a little worried right now,” Diane says.
“I know a lot of people my age who don’t know what to do,” she continued. “Other countries are taking care of their elderly, and we can do that too.”
Are you worried about retirement? How are you preparing? Share your story with this reporter. Ashfee.