5 Retirement Challenges for Older Employees

5 retirement challenges for older employees. New research highlights housing inequality on top of other barriers to retirement readiness.

A recent survey by Transamerica found nearly 70 percent of Baby Boomers expect to work past age 65 or don’t plan to retire at all. More than 80 percent of them say their decision to stay in the workforce is financially motivated.

Older employees are facing considerable financial challenges as they approach retirement. Homeownership rates are lower and debt rates are higher for older workers aged 50 to 64, as compared to earlier generations, according to research by the Joint Center for Housing Studies (JCHS).

“The falloff in homeownership rates among those approaching retirement, and the elevated levels of mortgage debt among those who do own, is concerning,” says Chris Herbert, Managing Director of the Joint Center for Housing Studies.

The dip in homeownership rates and the spike in mortgage debt is just the tip of the iceberg sinking older employees’ timelines for retirement. Older workers are paying off credit cards and student loans, providing financial support for grown children, becoming caretakers for aging relatives and struggling to save for emergencies, let alone retirement.

5 Retirement Challenges for Older Employees

Click through the slideshow below for some fast stats on five of the biggest retirement challenges older employees are facing on top of housing inequality:

1. Paying Down Debt
- 65.6% of Baby Boomers are paying off credit card debt, according to a survey by The Ascent.
- 44.3% use credit cards to make purchases they couldn’t afford otherwise.
- 39.3% have maxed out their credit card limits.
2. Providing Financial Support for Adult Children
- 50% of older adults have sacrificed their own retirement savings to help their adult children financially, according to a survey by Bankrate.
- 38% have or have had adult children live with them, according to a survey by the Nationwide Retirement Institute.
3. Becoming Caretakers for Aging Relatives
- 28% of Baby Boomers are or have been caregivers, according to a survey by Transamerica.
- 62% spend their own money on caregiver expenses, averaging $4,012 per year, according to a survey by the Nationwide Retirement Institute.
- 21% fear that caregiving expenses will prevent them from ever retiring.
4. Saving for Emergencies
- 31% of Baby Boomers do not have an emergency fund, according to a survey by Clever.
- If they were given $10,000, 53% would save that money for an emergency fund.
- 55.7% use credit cards to have a cushion for emergencies.
5. Saving for Retirement
- The average Baby Boomer has saved only 30% of the recommended savings for retirement ($136,779 in retirement fund savings), according to a survey by Clever.
- 22% have taken a loan and/or withdrawal from a 401(k) or similar plan or IRA, according to a survey by Transamerica.
- 58% believe they couldn’t save enough money to retire by age 65.

How Employers Can Help Older Employees Get Ready for Retirement

More than 60 percent of Baby Boomers feel like they don’t know as much about retirement investing as they should and almost as many of them (55 percent) would like more education and advice from their employers on how to reach their retirement goals.

Financial wellness programs, like Best Money Moves, give employees personalized tools to help them better manage their money, pay off their debts, build their savings and plan for retirement. Best Money Moves provides practical, unbiased help to make it easier for employees to solve financial problems quickly and easily. And, for employers, less financially-stressed employees translates into a happier, healthier and more productive workforce.