When working through a difficult issue, whether it involves a relationship, financial troubles, or even an addiction to Candy Crush, we are often told that the first step is "admitting you have a problem."
While most of us are in stable relationships and have our mobile-gaming urges under control, many of us have yet to admit that we have a problem with our retirement planning. For the past several years, top research groups have surveyed older Americans, and a growing percentage of seniors and boomers have saved little or nothing for retirement. Sadly, the statistics don't lie. The most recent study to catch my attention, sponsored by Wells Fargo, states that 34 percent of middle-class Americans are not currently contributing anything to a retirement plan.
Many so-called retirement experts have also failed to address the fact that such a large number of people are behind on their saving plans. The retirement planning industry, it seems, has yet to admit that it too has a problem.
For years, financial advisors of all sorts offered simplistic solutions to complex problems when it came to retirement planning. Seniors and boomers, not saving and often having trouble making ends meet, would be told to "save more." Yet how can they save more or use a catch-up provision if they can't pay their mortgage? Seniors and boomers need more options from the retirement-planning community. Fortunately, some things are moving in the right direction.
Plan to work and consider "unretirement." Many aging Americans have given up on the idea of retiring and figure they will "die at their desk." Not so fast. This solution is actually not as easy as it looks. We learned during the Great Recession that older Americans who lost their jobs had a difficult time finding new employment. Seniors who believe they can re-enter the workforce if they run out of money during retirement are likely mistaken. Ageism in the work world runs rampant, and changing technology can make someone unqualified for a position they held just a few years earlier.
One solution is for seniors and boomers to research and make a plan regarding how and for whom they will work during retirement. Essentially, working should be part of the plan, not just a failsafe. In addition to outlining other strategies, a recent article in the New York Times describes how several seniors have accomplished this. Author Chris Farrell published a book last year called "Unretirement," which suggests that boomers have the potential to, once again, transform the workforce by "extending their working lives, often with new careers, entrepreneurial ventures, and volunteer service." But it won't happen automatically. Seniors and boomers need to take charge of their work plans for retirement before they reach retirement age.