Seniors struggle to stay afloat in financial crisis

Seniors struggle to stay afloat in financial crisis

Senior citizens remain more vulnerable than other segments of the population to losses in the stock market and in home values, and will have a harder time recovering than younger Americans from the current global financial crisis.

A new study from Golden Gateway Financial, an online financial resource for seniors, shows that they understand their precarious situation and are exploring aggressive actions to stay afloat in this economy.

Results showed that nearly 80 percent of the senior citizens polled are worried about the impact of the financial crisis on their retirement savings. These seniors are actively exploring ways to generate additional income, with more than half of respondents considering returning to the workforce or delaying retirement.

Additionally, Golden Gateway Financial reported that the percentage of incoming calls to its offices involving senior citizens facing foreclosure rose nearly 200 percent in the last three months.

"Older Americans are aggressively searching for ways to gain control over and offset losses that might be near to impossible to recover in their lifetimes," said Eric Bachman, founder and CEO of Golden Gateway. "This is a generation that has seen and heard it all, and instead of asking them to overcome one more challenge we must effectively communicate the alternatives and solutions available to them."

Observations from the survey include:

•More than 60 percent of those 65 and older said the economic crisis has permanently hurt their retirement savings

•Nearly one third said they were planning to delay retirement because of the current economic crisis

•More than 20 percent of respondents are considering returning to work because of the effect of the financial crisis on their personal plans

•One quarter of respondents said they are either borrowing against their home or trying to sell it in order to generate income to survive

•Nearly 55 percent feel the current economic crisis is the worst they have experienced in their lifetime

•Three fourths of those surveyed are making adjustments to their lifestyle as a result of the current economic crisis

•Nearly one quarter said they have delayed making large purchases to conserve cash


“As savings accounts continue to shrink, alternatives such as reverse mortgages are an even more attractive and natural way for senior citizens to make retirement easier,” said Thomas Davidoff, an assistant professor at Haas School of Business at the University of California, Berkeley.

The independent online survey, conducted with Crestwood Associates in partnership with Golden Gateway Financial, polled more than 800 adult homeowners aged 65 or older from around the country.

Posted on Wednesday, December 24, 2008 (Archive on Wednesday, December 31, 2008)
Posted by jstoltz Contributed by jstoltz

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