As 2008 wanes, that merry soul King Cole is in the wings. Mother Hubbard and her barren cupboard are center stage.
“Property taxes, heating fuel and medical expenses are having a tremendous impact on seniors right now,” said Commissioner Mae Carpenter of the Westchester County Department of Senior Programs and Services. “This is the worst since 1987. People are really hurting.”
They”™re lacing up the work shoes, too.
“In a recent survey we conducted, 65 percent of workers 45 years and older say they now plan to delay retirement,” said Luci deHaan, communications director for New York AARP. “And 20 percent have stopped putting money into IRAs and pension plans. This is compounding what we”™ve been seeing. The average family now has less than $50,000 in retirement savings.”
DeHaan said the typical senior”™s income is like a stool supported by three legs: savings, Social Security and retirement plans like 401(k)s and pensions. “Two of those legs ”“ pensions and 401(k)s taken together and personal savings ”“ are on shaky legs,” she said. “The onus is on the backs of employees. The worker base is very worried to say the least.”
DeHaan”™s advice is not to panic. “Don”™t make rash decisions,” she said. “Markets go up and down. You should have an emergency fund available of six months of living expenses and make your savings ”“ like investing in a 401(k) ”“ automatic.”
AARP is seeking a sweeping workplace change in which 401(k)s would come with every job and the worker would have to opt out if he or she did not want to participate, instead of voluntarily opting in as is the case now. DeHaan said 75 percent of workers currently opt into 401(k)s, but if they came with jobs automatically, the participation rate would be 95 percent.
With the caveat that it”™s wise always to consult with finance professionals and to acknowledge individual needs, deHaan said, “As much as possible, do not take money out of your IRA or 401(k).”
Other numbers from the Washington, D.C.-based Knowledge Management survey of 1,628 respondents for AARP:
Ӣ 13 percent said they were prematurely tapping retirement funds;
Ӣ 24 percent had upped their work hours;
Ӣ 27 percent were finding it more difficult to make mortgage payments;
Ӣ 47 percent had helped a family member pay bills; and
Ӣ 12 percent had a family member move in with them for financial reasons.
Carpenter is seeing those numbers play out locally: “We”™re seeing a spike in employment requests through our Senior Community Services Employment program,” she said. “People thought they were prepared. Now, they”™re finding they have to go back to work.
“Even those who are not as exposed have had adult children who have lost jobs. In some cases, these are the adult children who have been helping with the finances.
“There are grandparents who want to see their grandchildren go to college. These people have questions like, ”˜If I spend money on my children, will Medicare pay for my coverage should I need it?”™ They”™re concerned with outliving their resources. These are challenging times.”
As the economy sours, Carpenter has seen a parallel rise in the con game. “It seems a lot of people who lost honest work have gone into scamming the elderly,” she said. “You may not be able to do anything about what you”™ve already lost, but protect what you have by not becoming a victim of consumer scams and fraud.”
Carpenter said those who feel they are being scammed should call the county Department of Consumer Protection at 995-2211 or 995-2155. She also advised seniors to take advantage of programs already funded and in place to help seniors, with information available at 813-6300.