Many of us edging closer to retirement have taken yet another hit to our retirement security. A new report says boomer households (ages 55 to 64) are earning nearly 10 percent less than they did three years ago, when the economic recovery officially began. What’s more, no other age group has suffered financially as much as this one.
Just when we most need our salaries to remain strong, at the end of our work lives, the report shows that median annual household income for near-retirees declined from $61,716 in June 2009 to $55,748, in today’s dollars.
And this age group wasn’t the only one to shoulder losses. Median income levels dropped for every age group under 65, according to the report, which the New York Times blogged about.
The one bright spot: older households. Only those with people 65 to 74 showed an increase in income, from $39,548 to $42,113. The report doesn’t explain why that might be.
The decline in income for near-retirees may be explained, at least in part, by the long-term unemployment of people 55-plus. Though the group’s unemployment rate (6.2 percent) last month was lower than the nation’s 8.3 percent, it takes older people much longer than younger adults to find work - at least a year on average.
Those who do find a job often take a cut in salary. Some never find work and settle, reluctantly, into retirement. They take early Social Security, lowering their benefit for life, and rely on their assets to cover a retirement that could stretch as long as 30 years.
At the same time, falling home values and sinking or stagnant portfolios continue to put pressure on those of us in our 50s and 60s as we try to grow our assets. Since our generation is expected to shoulder more of the burden for our retirement, experts say planning and calculating how much we’ll need is more important than ever.
Income levels, according to the report, hit some racial groups harder than others. Black households saw the biggest decline in household income, from 36,567 to $32,498. Whites went from $59,324 to $56,255. Income levels for Hispanic households went from $41,967 to $40,265.
Credit: Sabine Scheckel/Getty Images