Before the recession, Madie Green's home day care was normally full. As parents lost their jobs and pulled kids out, the 55-year-old District Heights, Md., woman spent through her savings to keep up on her mortgage and auto payments.
Her business still hasn't recovered to what it once was, and now she's so worried about whether she'll be able to retire that she is expanding into an after-school program for elementary- and middle-school students.
Retirement seems more distant than ever.
“It's no longer the golden years,” Green said.
These days, the sentiment is more common.
Though stock prices have generally shown resilience, unemployment is falling and the economy is growing, more workers are choosing to stay in the labor force longer. The trend reverses decades of steadily falling retirement ages. During the recession, delaying retirement was spurred by job losses, salary reductions, depressed home prices and depleted savings. Now, workers anticipate smaller returns on their investments. Health benefits for retirees also are eroding even as costs are rising. Meanwhile, people are living longer, healthier lives — all of which adds up to a need to work and save longer.
The share of workers nationwide aged 45 to 60 who planned to delay retirement soared to 62 percent last year, the Conference Board reported, up from 42 percent in 2010.
Separately, analysts at the University of Michigan's Institute for Social Research found that about 40 percent of older Americans have delayed their planned retirement since the end of the recession.
And in a poll released this week by the Associated Press-NORC Center for Public Affairs Research, 82 percent of working Americans over 50 said it was at least somewhat likely they will work for pay in retirement. The survey found 47 percent of working survey respondents now expect to retire later than they previously thought and, on average, plan to call it quits at about 66, or nearly three years later than their estimate when they were 40.
Graphic designer Tom Sadowski, 65, of Sterling, Va., had expected to retire this year, but the recession caused his business to fail and his savings to take a hit. With four teenage daughters, he knew he had to put retirement off.
“At this age, my dad had already been retired 10 years and moved to Florida,” he said. “Times are different now for most people.”
Sadowski now plans to retire in about five years, but even then, he expects to do some work for pay. He notes that some of his friends without children have begun to retire, but he tries not to dwell on his shifted plans.
“For a moment, maybe, I have a twinge of, 'I wish that were me,'” he said. “But you can't live that way.”
Since the recession ended, “a lot of people spent more than they earned and had to continue to deplete their savings, and that makes them less prepared for retirement,” said Gad Levanon, director of macroeconomic research for the Conference Board. “People were unemployed for a while, or worked part time or got significant pay cuts and were unable to cover their expenses. Savings shrunk and made them more willing to delay retirement.”
The Conference Board found that workers 45 to 60 who have lost a job, had a salary cut or saw their home decline in value are more likely than others to plan to delay retirement. But even workers who were not significantly hurt by the recession are more likely than before to plan to work longer. That trend held true across all ethnic, gender and income lines.
CareerBuilder found 60 percent of workers ages 60 or older planned to look for another job after retiring from their current company — up from 57 percent last year. About three-quarters of respondents planned to work an additional one to six years, and more than 1 in 10 of 680 workers surveyed said they probably never would be able to retire.
A Gallup survey released Thursday showed a three-percentage-point increase since 2010 in the percentage of Americans age 65 and older who are in the workforce — employed full time through an employer, self-employed, working part time, or unemployed but actively searching for work. At the same time, there has been a two-point decrease in the percentage of Americans age 18 to 29 who are in the workforce.
On average, those who delayed retirement are waiting about 1½ years longer than they originally planned to leave their jobs, said Brooke Helppie McFall, an economist with Michigan's Institute for Social Research.
Many workers have lost too much value in savings and other assets or were forced to draw down on those assets, McFall said. The biggest asset for most people is their home, and housing prices still have not recovered to pre-recession levels.
The recession exerted particular influence on the retirement plans of men 55 to 64, U.S. Labor Department statistics show.
“Their retirement is less secure than they had thought,” said labor economist Heidi Shierholz, either because of a decrease in assets or a loss of a job that left a long-term income gap.
“More of them are in the labor force than there would be if the Great Recession hadn't happened,” said Shierholz, with the Washington-based Economic Policy Institute, who compared Bureau of Labor Statistics pre-recession projections to actual employment figures.
Jeff Miller realized two years ago he would not meet his goal of retiring at 62.
A computer server engineer at a Frederick, Md., data center for Marriott International, Miller suffered losses in the value of his 401(k) and his home. Plus, he has seven more years to pay off a student loan for his son.
At 61, he expects to work at least six more years.
“I was hoping for 62, but that went out the window when the economy went south,” Miller said. “And I couldn't have sold my house four years ago.”
He and his wife, a real estate agent who's not ready to stop working, have put off plans to sell their home in Monrovia, Md., and retire out of state, where they hope to pay lower taxes on a comparable home.
Staying at work longer might be the financially savvy way to go anyway, financial planners say.
“Sometimes it's OK for those who are happy in their jobs,” said Christopher Brown, president of Ivy League Financial Advisors in Rockville, Md. “Sometimes it's painful.”
“The big question that each client asks as they prepare for retirement is, 'Can I live the lifestyle I want to live without running out of money?' “ Brown said. “When the market hit the skids in 2008, a lot of people's retirement portfolios were really hurt. They want to build some cushion into their retirement if it happens again.”
“The definition of retirement has changed,” said Brad Glickman, a certified financial planner with a large number of baby-boomer clients in Chevy Chase, Md. “Now the question we ask our clients is, 'What's your job after retirement?”'
Paulette Miller, no relation to Jeff Miller, is 68 and retired six years ago from running a catering business in Virginia. Financial and family troubles, however, have pushed her back into the job market. The resident of Nottingham, Md., has owned a business, managed a resort and taught adult literacy and marketing but has been unable to find a full-time job.
She supplements her Social Security income by running 10-day sales events at Costco, where she sells clothing, shoes and bedding for marketing companies, and by acting as an extra in Baltimore-filmed television shows and movies.
“When I retired, I didn't plan on going back to work,” Miller said. “Unfortunately, that has happened. I have to work when I can.”
Otherwise, she said, she wouldn't be able to afford her health insurance — and that's getting even tougher to cover. Her costs for Medicare, supplemental insurance and dental insurance rose this year, but “my Social Security did not go up, so I am further in the hole,” she said. “I'm making less than I was making three years ago.”
She said she plans to keep working “as long as I'm standing up.”
This report includes material from the Associated Press.