Older Workers Finding It Difficult To Retire

Nov. 03--David J. Cocuzza knows exactly what he would do in retirement: perfect his mandolin playing and tend the garden of his Muhlenberg Township home.

Indeed, at 63, Cocuzza thought by now he'd be retired from managing the Bern Township office of Philadelphia Ball and Roller Bearing Co.

"I was hoping to retire two years ago," Cocuzza said. "but I've told my employer I'll be working at least another two years."

Cocuzza's not alone in his decision to put off retiring.

A recent Associated Press survey of 1,024 people older than 50 showed that nearly half expected to retire at a later age than they had anticipated. And 82 percent said they expected to work at least part time in retirement.

The survey suggested a shift away from the ideal of retiring to Florida and never working again, a hallmark of the World War II generation.

The baby boomers, it appears, will be working longer and retiring later than their parents.

Participation of seniors in the workforce, which declined for decades following the advent of Social Security in the 1930s, began growing in the 1990s. Older adults are the fastest-growing segment in the workplace and are projected to make up 25 percent of the workforce by 2020, the AP found.

Tricia J. Salvatore Ludgate, a consultant at Financial Planning Advisors in Wyomissing, said long-held attitudes toward retirement are changing.

"There's a whole new retirement landscape out there," she said. "People are increasingly delaying retirement or transitioning into it."

Forget the 'golden handshake'

Gone are the days when companies offered incentive retirement packages to workers still in their 50s.

When Lucent Technologies Inc. offered an early retirement package in 1987, then-58-year-old Gustav Johnson of Spring Township gladly extended his hand for what workers called "the golden handshake."

"You're never going to see anything like that again," said Johnson, 84, who's been retired for 26 years. "The way things are now, people are lucky to have jobs."

Ludgate, who advises clients on investing for retirement, said the high cost of medical insurance and the prospect of living longer are driving decisions about when to retire.

One of Ludgate's clients who left a job at a Berks County school district found that replacing the medical insurance plan cost $14,900 a year.

Working part time, the retiree doesn't even earn enough to pay the cost of medical insurance.

"Some people are going to live 40 or more years in retirement," Ludgate said. "We're living longer, and we're going to have to work longer."

Changing plans

The AP survey found that 47 percent of the respondents planned to work until age 66, three years longer than they had anticipated when they were 40.

Beverly Kapelski, 51, a Bernville nurse, figures she'll have to work until her late 60s before being financially able to retire.

Kapelski has a retirement plan but worries it won't be adequate over the long haul in retirement.

"In retirement, you're basically on a fixed income," she said. "At least when you're working, you get overtime and cost-of-living raises."

Debbie Rear of West Reading, who's 54, says there's no way she's going to retire at 62 when she becomes eligible for Social Security.

She has a 401(k) retirement account, but thinks it will be inadequate to keep pace with the rising cost of just about everything once she's no longer employed.

"You have too many things to pay off," said Rear, an activities coordinator at a retirement home. "I'll end up working at least part time in retirement."

Conducted by the AP-NORC Center for Public Affairs Research at the University of Chicago, the survey found about 29 percent of respondents had savings of at least $100,000.

At the same time, one in six respondents had less than $1,000 set aside for retirement, and one in four had no retirement savings other than Social Security.

Among those still on the job, 47 percent were very or extremely likely and 35 percent were somewhat likely to do some kind of work in retirement.

Men, racial minorities, parents with minor children, people who earn less than $50,000 a year and workers without health insurance were the most likely to put off retirement.

About 75 percent of respondents said they had given retirement some or a great deal of thought.

Facing the realities

Cocuzza acknowledges he's thought a lot about retirement.

His wife, Susan Cocuzza, retired four years ago from her position as administrative law judge with the state Department of Public Welfare.

Someday he'd like to do the same.

"Naturally, financial considerations are important," he said. "You have to face the reality that you need a certain income to maintain your standard of living."

Yet, for a generation steeped in the work ethic, it's not all about money.

Cocuzza's proud that he worked his way up from a driver to manager of a seven-person staff that supplies industrial lubricants and related services to clients throughout the Berks County region. At this point in his career, grooming a successor for a fast-paced, highly-competitive business environment is one of his primary goals.

One of his salesmen tells Cocuzza that, should he retire, he'd miss the action.

"That's quite possible, but I want to find out for myself," he said. "On the other hand, I'd leave the door open so that if I do miss the action, I could get back in."

Contact Ron Devlin: 610-371-5030 or [email protected].

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