BAKERSFIELD, Calif. (KERO) — A growing number of older Americans are discovering that retirement isn't always financially sustainable, with a recent AARP survey finding that about 7% of retirees have returned to the workforce in the past six months.
While returning to work after retirement has historically not been unusual, with some people simply missing the sense of productivity that comes with employment, local economist Aaron Hegde says an increase in the trend is likely driven by savings that aren't stretching as far as retirees expected.
"And you think you'll lead this rich life in retirement, and maybe that doesn't work out, and you miss, some people just like being in the work environment where they feel more productive," Hegde said.
Rising costs, particularly for healthcare, housing, and everyday necessities, are putting pressure on retirement savings. Many Americans rely heavily on 401(k) retirement accounts, which are tied to the stock market, meaning retirement income can fluctuate when markets do.
"Maybe, depending on what savings you had in the market, maybe it's not enough," Hegde said.
Healthcare costs are another major factor. Hegde says medical expenses tend to rise significantly later in life, making long-term financial planning difficult. At the same time, Americans are living longer, which means retirement savings need to last longer too.
"And then if you live past 85, all of a sudden you don't have enough money, and the longer you live, the more likely it is that your healthcare costs will be higher," Hegde said.
Retirees who return to work in industries like healthcare and education can help address workforce shortages. But Hegde says wanting to return to work doesn't guarantee an employer will be willing to hire you.
"But there's also a lot of folks who have retired who just can't make ends meet, but they just don't have the opportunities to go back," Hegde said.
Hegde says the trend also carries a lesson for younger workers: start saving early. According to Hegde, less than 40% of people between the ages of 50 and 65 are financially prepared for retirement.
"Start saving today. It doesn't matter how old you are. When you start saving for retirement, then you don't have to wait until you die basically to keep working," Hegde said.
This story was reported on-air by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
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