By Rick McCrabb, Dayton Daily News, Ohio
June 24--Retirees are finding their "golden years" -- the ones they worked their adult lives to create -- are now filled with financial hardships and unexpected debt.
Since the Great Recession when the stock market plummeted in 2008, seniors have seen the value of portfolios plummet, the cost of health care skyrocket, interest rates fall, and a sluggish housing market, said William Even, economics professor in the Farmer School of Business at Miami University.
He called these financial factors the "perfect storm" for area retirees.
And now that the economy is slowing coming back, many of these retirees are finding their nest eggs are not big enough and they're either going back to work or making tough budget decisions.
Recent retirees and senior citizens have been hit harder by the recession, and in many cases, are lagging behind others who have seen growth in their income with the slowly growing economy.
A quarter of adults age 50 and older say they exhausted their savings, and 12 percent lost health insurance, according to an AARP Public Policy Institute survey.
When the stock market crashed, some seniors, strapped for cash, liquidated their investments before the recent Wall Street rebound, Even said.
Others, Even said, hoping to downsize their homes after their children moved out or they were unable to maintain the property, either couldn't sell their houses or sold them under their appraised value.
And the cost of health care has risen faster than social security benefits, he said.
"It's tough all the way around for seniors," he said.
Ron VanArsdale, 74, retired in 1989 from the Middletown Division of Police and works part-time in the court's diversion program. As he neared retirement, VanArsdale calculated he had saved enough money to last until he was 85. Now, he said, that's not the case.
"I better die when I'm 80," he said with a laugh.
VanArsdale blamed the soft housing market for causing the majority of the financial troubles for seniors. He said once they paid off their homes -- their largest investments -- they expected to live off the profit.
Then the housing market tanked.
"It went bad fast," he said.
Household income has fallen by 6 percent for adults ages 55 to 64 since 2007, according to the AARP Public Policy Institute survey.
The recession also caused many retirees to file for Social Security earlier than they would. A study by the Center for Retirement Research at Boston College showed 21 percent of the people who retired since 2009 started their benefits immediately because of the economy.
Filing for the benefits earlier reduced their Social Security checks by $94 a month or $1,128 a year, according to the study.
Nick Nett, 79, of Monroe, said while living in New York, he "busted his chops" working two jobs -- in manufacturing and as a pool hall owner -- to pay off his home and save for retirement. Now, he said, because of his financial situation, he can't buy birthday presents for his older grandchildren.
"I never thought I'd do that," he said while shooting pool at the Middletown Senior Citizens Center. He also combines trips because of high gas prices.
He could only shake his head.
"Why did I work all those years for?" he asked.
Patti Stoll, wealth relationship adviser for First Financial Bank, said it's imperative for those nearing retirement to discuss their financial future with a professional.
That means seeing what she called the "entire picture," looking at their assets, their life expectancy, their cash flow. Sometimes, she said, some "tough decisions" must be made, and the budget must be adjusted.
"You have to put the numbers down and work through it," she said.
Natalie Ott, 73, a volunteer at the senior center, said most of the $1,000 she receives monthly in social security benefits is earmarked for medical bills.
"You've only got so much money and before you know it, it's gone," said Ott, who retired from a Kentucky factory before moving to Middletown. "Everything seems to be going up but wages."
When Kathy Peters, 63, of Hamilton, retired from Rumpke five years ago, she figured she had saved enough to live comfortably. But the rising out-of-pocket health care costs are sabotaging those savings.
"That's a problem," she said. "I always figured that tomorrow would be OK, but now I'm not sure that tomorrow will be OK."
There was a time, she said, when she had "a whole bunch of money," but now, she has "jack zip."
Then she added with a shrug of her shoulders: "You have to play the hand you're dealt."
Anne Palmer, 65, of Liberty Twp., retired from Miami University in January 2011 after 20 years. She felt financially secure. Now she sees her savings "disappearing" so she's tightening her budget even more.
"It is hard," she said. "You just don't know what to do."
When asked if she expected to see the economy in such poor shape, Katie Lamb, 85, shot back: "Absolutely not."
Lamb drove a city bus in Fairfield for more than 20 years, and watched her money closely. Most of her saving is budgeted for medical expenses.
"It's dwindling down," she said.
Virginia Barnes is frustrated. She worked for 19 years for Ohio Casualty, and for the last five years, part-time at Fort Hamilton Hospital. She is 70 and she can't afford to get sick.
"I've worked my entire life and it's taken away," she said.
She recently purchased a $2,700 hearing aid that she's paying off monthly. She had rotator cuff surgery and was supposed to attend physical rehabilitation three times a week. But since her co-pay is $40 per visit, she stopped after the first week.
Her $700-a-month Social Security isn't enough.
"It's scary," she said. "You can't catch up. Us seniors, we're fighting a losing battle."
To assist seniors, John Ratliff, a spokesman for the Ohio Department of Aging, said the agency has created a Civic Engagement that hopes to expand the focus of lifelong learning and volunteerism as tools for increasing job readiness among seniors.
Contact this reporter at (513) 705-2842 or mailto:firstname.lastname@example.org.
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