Many consumers worry about the quickening pace of inflation, but perhaps the most concerned with rising prices are senior citizens, especially those who have retired on a fixed income or are set to retire soon.
A December 2021survey from reverse mortgage lender American Advisors Group (AAG) asked U.S. homeowners aged 60 to 75 about their views on retirement and finances, and found a majority were worried about inflation, while almost 1 in 3 feared they might outlive their money.
Seniors under financial pressure
The survey participants showed an overall fear of rising prices, with 66% worried that inflation will negatively impact their retirement.
At the same time…
- 37% said they need to increase their cash flow in order to live comfortably
- 29% believed they will outlive their money
But on the other hand, most seniors surveyed felt their retirement plan was — so far — working out as planned (just 28% said it wasn’t), and only 19% said the COVID-19 pandemic had affected their retirement planning. This last finding contrasted with data from another recent survey, showing a full 30% of workers over 65 felt the pandemic had delayed their retirement.
In terms of feeling prepared, 53% said the cost of living in retirement was higher than they had expected, but a smaller 36% reported having less money than they thought they would have. Likewise, 37% said their past employers failed to help them "achieve the retirement they wanted."
The outlook was not so rosey in terms of retirement for other age groups. Among the survey respondents, a minority of 39% thought the previous generation had an easier time retiring, but a strong majority of 81% thought the next generation would have an even harder time retiring comfortably.
Senior women may face harder challenges
The survey also found that divorced and widowed senior women were among the most likely to report fears and difficulties connected to their retirement.
For instance, 72% of older widows and divorcees were worried about inflation (versus 66% overall), and 61% said retirement was more expensive than they had anticipated (versus 53% overall).
And, as noted above, just over a third (37%) of respondents felt they needed more income to make ends meet, a full 50% of divorced and widowed senior women fell into this category.
Other evidence also suggests that the economic fallout from the COVID-19 crisis hit this group especially hard. For example, a separate survey found 20% of women over age 45 had delayed retirement due to the pandemic.
Methodology: AAG’s Modern Retirement Survey was conducted on Dec. 8, 2021 and included 1,580 U.S.-based homeowners between the ages of 60 to 75. The survey was conducted on a digital platform.