Retiring to Care for Grandchild isn’t Unusual
Retirement can change everything. So can grandchildren. A new study that looks at the transitions made by older workers finds that the odds of relocating after they retire to be closer to their adult children increase from the pre-retirement years – 16 percent of recent retirees do so. Some people make these moves, to within 10 miles of family, right around the time of retirement, but the relocations are still happening at least four years afterward. A new grandchild provides an even more compelling reason to move at a time quality childcare is expensive and in short supply. In the study, the researchers found that one in 10 grandparents who, prior to retiring, already considered themselves caregivers for at least one child…
December 13, 2022
The Shrinking Middle and Shrinking Wages
My husband likes to tell a story about his father, Joseph Virchick, who was a pipefitter for the Standard Oil refinery in Bayonne, New Jersey, starting in the 1950s. It was a union job – the Teamsters – paying solid middle-class wages that supported his family in an upscale Levitt development with its own swimming pool. The point here is that this pipefitter with a high school degree lived about as well as his college-educated neighbors who commuted into nearby Manhattan. Virchick and his wife, Henrietta, who also worked, sent all three kids to college. When he retired in the 1980s, they had a pipefitter’s pension to supplement their Social Security. Today, only 6 percent of private-sector workers are unionized…
December 8, 2022
COVID’s Impact on Claiming Social Security
The economy expanded smartly in the years before the Great Recession, just as it did before the COVID downturn. But the two recessions were markedly different, with opposite effects on when older workers signed up for Social Security, a new study finds. In 2008, the stock market slid nearly 40 percent. Older Americans with retirement accounts, wanting to recoup their losses, were more likely to keep working or looking for a new job during the protracted downturn. But skyrocketing unemployment pushed many older workers in the other direction. Social Security became an obvious fallback in the Great Recession for jobless workers who were at least 62 years old as the unemployment rate stagnated at around 10 percent for 1½ years. Not surprisingly,…
December 6, 2022
COVID’s Small Impact on Future Mortality
The most COVID deaths were among Americans over age 60, who accounted for 300,000 of the 500,000 U.S. deaths from the disease in its first year. A new study by the Center for Retirement Research finds, not surprisingly, that the oldest survivors of the early months of the pandemic were healthier than those who died from the virus. Taking this into account, the researchers estimated what mortality might look like in a “post-COVID” world in an analysis that was based on a big assumption – that COVID’s deaths were confined to a single year. Factoring in the early impact of the virus, the researchers found that, despite COVID’s tragic toll in the over-60 population, their future mortality would decline only slightly becaus…
December 1, 2022
The Cost of Having a Disability in COVID
In COVID’s early months, millions of workers’ incomes dried up as the unemployment rate skyrocketed. But older Americans were somewhat shielded from the downturn. That’s because they either are over 62 and on Social Security or receive federal disability benefits every month at higher rates than young adults. And just like everybody else, they got relief checks from Congress to soften the blow from the pandemic. Yet, despite the reliability of a government check, older Americans with disabilities suffered from “acute financial insecurity,” according to a new study that seeks to understand why. During the pandemic, people over the age of 50 with disabilities reported having much more difficulty paying for food than people without a disability. They also showed more signs…
November 29, 2022
Happy Thanksgiving!
The staff at the Center for Retirement Research at Boston College who put together this blog hope our readers have a safe, joyful and delicious Thanksgiving with family and friends. To start getting an email with each week’s blogs on topics ranging from retirement and employee benefits to economic research, consider signing up here. Squared Away writer Kim Blanton invites you to follow us on Twitter @SquaredAwayBC. This blog is supported by the Center for Retirement Research at Boston College.&nbs…
November 23, 2022
Tis the Season to Shop for Medicare Options
Americans are fighting back against soaring food prices by shopping at discount grocers, buying lower-cost store brands, or giving up their favorite gourmet items. Yet Medicare beneficiaries usually don’t shop around for a less expensive insurance policy or a higher quality one. It’s also advisable for retirees to review their current plans to make sure they still include the right doctors or prescription drugs for treating any new medical conditions. Open enrollment for Medicare Advantage and Part D plans started Oct. 15 and ends Dec. 7. Over their lifetimes, retirees will spend an average $67,000 out-of-pocket for medical care – and that does not include the monthly premiums. The least healthy retirees will pay twice that much. Yet only three in 10 peo…
November 22, 2022
Spouse in Nursing Home Raises Poverty Risk
When nursing home care uses up a widow’s savings, the federal Medicaid program will kick in and cover her bills for care. But it’s more complicated for couples. If one spouse moves into a nursing home and the bills start piling up, the person who is still living in their home can face serious financial hardship and even poverty. This is a significant risk facing the one in three married people in their early 70s whose spouse will eventually wind up in a nursing home, researchers at RAND found in a study on the financial impact on couples rather than individuals. It’s not unusual to pay roughly $90,000 for a year for a semi-private in a nursing home, though many people have relatively short stays…
November 17, 2022
Paid Sick Time Spreading in the COVID Era
The pandemic has done good things for paid sick time. Today, 77 percent of all employees in the private sector get paid time off for short-term illnesses and preventive medical care. That’s a modest four points higher than in 2019 but at least it’s going in the right direction. However, coverage remains low at the bottom of the wage scale where workers are much less likely to have any type of employer benefits. Just 55 percent of workers with earnings in the bottom 25 percent of all workers receive paid sick time, according to a 2022 report by the Economic Policy Institute. Even their coverage has increased – from 47 percent prior to the pandemic – but they’re still trailing far behind…
November 17, 2022
Traditional Medicare or an Advantage Plan?
Medicare Advantage or traditional Medicare with supplemental insurance: which should you choose? A compelling reason so many 65-year-olds are flocking to Medicare Advantage insurance policies is that they tend to have significantly lower premiums than enrolling directly in traditional Medicare. Retirees are also inundated with advertisements on television, online and in the mail urging them to sign up for the Advantage plans, which sometimes cover vision and dental care. But the premium alone is a superficial test for such a consequential decision. Traditional Medicare plans combined with a Medigap or Part D drug plan might, in the end, be less costly. Differences in the quality of care and the out-of-pocket costs can weigh more heavily over the long haul as…
November 10, 2022
A New Link Between Opioids and Disability
Picture a worker who has an injury so traumatic that he or she is rushed to the emergency room. A doctor prescribes an opioid to ease the pain. A new working paper adds to the growing evidence that taking opioids, even when necessary, can have serious long-term consequences for workers’ career paths. Michael Dworsky at RAND found that workers who received prescription opioids after visiting Colorado emergency rooms were far more likely to enroll in Medicare before turning 65 than people who didn’t get a prescription to treat an injury. Starting Medicare before 65 almost always indicates that someone has left the labor force and is receiving benefits from Social Security Disability Insurance, the primary social program for workers with disabilities. Dworsky…
November 8, 2022
Banks Could be More Retiree Friendly
Anyone who has lived paycheck to paycheck is familiar with the headache of overdraft charges. Due to a slight miscalculation at the end of a tough month, there isn’t enough money in the account to cover a check. The bank pays the check but charges an overdraft fee that drains money out of the account. A negative balance would trigger an overdraft fee on a different check or cause it to bounce. Of course people should manage their finances responsibly. But the federal Consumer Financial Protection Bureau (CFPB) argues that older people in particular are at a disadvantage, and perhaps banks should put practices in place that protect them from overdrafts, which the CFPB said produce billions in revenue every…