The workforce shortage and rising cost of living have caused many retirees to go back into the labor market. Some are returning to work simply due to boredom, while others are unretiring due to the difficulties of living on a fixed income. Going back to work offers a financial backup plan for retirees struggling with inflation that only seems to get higher each week. Jobs for retirees are also plentiful, as many companies have struggled to find workers since the pandemic. The rise of remote work also allows retirees to work from home without having to travel back and forth to the office.
Inflation & Retirees
One of the biggest reasons retirees are going back to work is due to inflation. The rising cost of living is especially challenging for anyone living on a fixed income. Trying to make ends meet is difficult with prices rapidly increasing for food, household products, and fuel. Choosing to go back to work during these challenging times is one way to lessen the impact of inflation. Finding ways to cut back on your spending habits is also key to staying within a budget.
Retirees are Heading Back to Work
The rising costs are putting a major squeeze on over 56 million residents that are aged 65 and up, as many of them rely on a fixed income and only a limited amount of savings. Americans within this age range are even more likely to be living in poverty compared to younger adults, according to data from the Census Bureau. Going back to work after retirement isn’t always a choice, but it’s essential for older Americans to handle the challenges of inflation. The ever-rising cost of food, gas, and housing makes it nearly impossible to manage while living on a fixed income.
Challenges of the Rising Cost of Living
Half of older Americans that live alone make less than $27,000 a year, according to the Gerontology Institute at the University of Massachusetts. Any small change in circumstances can be disastrous, whether it’s a medical emergency, rising grocery prices, or an appliance breakdown. The steady increase in inflation only puts more pressure on older Americans, which is why many retirees are going back to work. The increasing costs don’t only impact retirees, as it’s also impacting those considering retirement. Plenty of baby boomers are delaying retirement due to inflation and the unpredictable nature of the economy.
Cost-of-Living Adjustments Aren’t Enough
Social Security payments include cost-of-living adjustments, but there is often a three to twelve-month lag between the rising cost of living and higher payments. For example, Social Security recipients gained a 5.9 percent increase in their monthly checks, but this was based on inflation calculations between July to September of 2021. On the other hand, overall prices have increased by 7.9 percent within the past year, which is why cost-of-living adjustments are often not enough to cover these increases. While cost-of-living increases help to protect older Americans against the long-term effects of inflation, they don’t provide much value for shielding them against short-term price increases.
How to Adjust While Dealing With Inflation
Inflation is making a big impact on all areas of the economy. Knowing how to create and follow a budget is essential for seniors living on a fixed income. While unretiring will give you more financial flexibility, it’s still important to look at ways to reduce costs during these challenging times. Cutting back on eating out or even increasing the thermostat settings in your home can help you save money each month. Canceling automatic subscriptions and making adjustments to your cell phone plan also result in additional savings. Frequently reviewing your budget while cutting out any unnecessary items is essential while dealing with the rising cost of living.
Jobs for retirees are plentiful due to the workforce shortage. Many retirees on a fixed income are choosing to return to work because of the rising cost of living. Unretiring also provides a financial backup plan for those living on a tight budget. These jobs for retirees allow them to take advantage of a much-needed source of income to combat the rising cost of goods. The economic uncertainty is also motivating many older Americans to return to the workforce, as no one knows how long inflation will last before things eventually return back to normal.