Chapter Two

A Snapshot A Look at What Getting Older Is Likely to Cost You

Location. Gender.

Factors that determine what your later years may cost. Let’s take them one at a time.

Are you male or female?

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Longevity

You are likely to live longer and thus have higher health care expenses than men.

401(k)-less

You are more likely to work in part-time jobs that don’t qualify for a retirement plan.

Rx

You are likely to have fewer health care expenses than women because on average men don’t live as long as women.

I started a new career at the age of 54 and I am now teaching nursing. I feel young, and luckily my body matches that life vision.

— Paula Gjerstad, 68

Chutzpah

You are significantly more likely than a woman to feel very confident about having enough money for medical expenses and that you will live comfortably in retirement.

Family Matters

In addition, working women are more likely than men to interrupt their careers to take care of family members, which means lower lifetime income, lower contributions to Social Security and thus lower Social Security benefits upon retirement.

Income

You make 77 cents for every dollar a man makes, as an average across all occupations. So again, your Social Security benefits, should you qualify, will be a bit lower.

Mind the Gap

On average, your retirement account is worth 38.25% less than a man’s. (However, that gap is slowly closing.)

401(k)

You’re slightly less likely than a woman to participate in a retirement plan, when controlling for work status or earnings.

In a household where the wife stayed home to raise the kids and then enters the workforce in her 40s or 50s, you often find she will put a much, much higher percentage into her retirement savings than a woman of the same age who’s worked her whole life. This is an acknowledgement that she has to catch up for all those years she missed.

— Jack VanDerhei Research Director, Employee Benefit Research Institute

If you’re a woman age 65 or older, you will likely be out of work for at least six months should you lose your job.

I was tentatively flirting with early retirement in the late ‘90s until my neatly-built nest egg disappeared with the dot-com downturn. I stayed on and continued to progress up the ladder of success until 2008 when that rug was pulled out from under me… again! I am now a farmer! And I'm going to stay a farmer until they pry my cold, dead hands off my (soon to be bought) tractor.

— Michael Davidson, 65

After I retired [at age 66] I competed for a volunteer docent position at a large local museum, received two years of intensive training comparable to an undergraduate degree in art history, and am now immersed in a whole new life of work! It is wonderful to re-pot yourself and let younger people step up.

— Traer Sunley, 70

Men and women are equally likely to:

  • Say they have saved at least something for retirement (but a third aren’t saving anything at all).
  • Calculate how much they need to live comfortably in retirement (though over half who are working still haven’t done this).
  • Think less than $250,000 will be sufficient for retirement. (Teaser: it’s not!)
  • Have a median expected retirement age of 65.
  • Work—about 62% of men and 59% of women work.

In just four years, the number of older workers in urban counties declined,
while older workers in rural communities grew.

Data from a study of U.S. counties by Experian and via Dante Chinni, author of Our Patchwork Nation.

What’s your community size?

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Change in the percent of workers 65+ by community size. From 2008–2012, employed full- or part-time.

 
no change
7%
 
-3%
 
 
-3%

Joel Peters, Paramedic

Joel Peters is a 62-year-old paramedic who works 12-hour shifts. He does not know if he’ll be able to retire or what his financial future will hold, but he is sure that he will not be moving from his rural home near Taos, NM.

So what’s geography got to do with it? We turned to Dante Chinni, author of Our Patchwork Nation, to explain:

While the Great Recession took a toll on everyone, there was a distinct difference between rural and urban America. The percentage of older Americans employed full- or part-time actually declined in the most urban, densely populated counties. In smaller rural counties, however, the number of older Americans in the workforce rose sharply.

— Dante Chinni Author of Our Patchwork Nation

The Urban/Rural Divide

Does that mean rural America is actually better for older workers—a haven for those working for enjoyment or personal fulfillment? Read on.

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Are you male or female?

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What’s your community size?

  • Largest US Cities
  • Less Urbanized
  • Rural Area
  • Very Rural Area
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Credits

The Sloan Center is funded by the Alfred P. Sloan Foundation,
which is an underwriter of this project and the PBS NewsHour.

PBS NewsHour: Content and Editorial

Design and Development: Ocupop

Header Photo

Chapter Title Photos from Flickr users

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Sources

AARP

AARP/USA Today

Census

Center for Retirement Research at Boston College

CNN

The Economist

The Employee Benefit Research Institute (EBRI)

MSN Money

National Bureau of Economic Research

The New York Times

The Pew Charitable Trusts

Pew Research Center

Pew Research Social & Demographic Trends

Retirement Security Project; Senate Committee on Health, Education, Labor, and Pensions

The Schwartz Center for Economic Policy Analysis

Social Security Administration

Vanguard

The Washington Post