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Jeffrey D. Allred, Deseret News
Bob Wassom works in a coffee shop. He's a 29-year advertising professional who lost his job and is now trying to make it as a freelance writer.

Bob Wassom was at the top of his career when the advertising company he worked for merged with another. Five years later, his contract was not renewed.

That was in 2006. Wassom's buyout kept him going about a year. Now the freelance writer, too young to retire at age 58, is looking to his 401(k) to help support his family and help an adult daughter with medical bills. He plans to take out about 40 percent of his previous salary each year for five years — taxed without penalty.

Tapping into the nest egg can be unsettling, but more baby boomers are having to do it. They also are watching their retirement savings dive in a bear market. They're paying more than $4 a gallon at the pump. And food prices have jumped in recent months along the Wasatch Front.

As a result, some older workers are choosing to delay their retirement. And some retirees — about 10 percent, according to one estimate — are coming back to work to make ends meet. That is, if they can find a job.

The AARP found that one-fourth of the nation's 45-and-older crowd, surveyed in May, were struggling to make their rent or mortgage payments. Twenty-seven percent of workers said they were postponing retirement plans. The study included 1,002 respondents nationwide.

A retirement survey conducted in January by the Employee Benefit Research Institute in Washington, D.C., found that 38 percent of those over age 55 expect to retire after age 66. Ten years ago, the same number thought they would retire between age 60 and 64.

In recent years, experts predicted that baby boomers, people 44 to 62 years old, would contribute to a massive wave of retirement, starting about now. That may no longer be.

Wassom isn't sure he wants to come back to the 9-to-5 world. A 36-year-old spinal cord injury still bothers him. He's hoping networking, contract work and freelance jobs will keep him going four more years, when he'll be old enough to retire.

"I'm doing OK but not making nearly the money I used to," said Wassom, taking time out from contract work at the AARP Utah offices in Midvale. "It's good — I'm finding new freedoms. But it's kind of scary ... waking up in the morning and not knowing what's going to happen."

Falling markets

Employees 55 and over will become the fastest-growing group of workers in the nation, making up almost a fourth of the work force by 2016, according to the U.S. Bureau of Labor Statistics. That's up from 17 percent of the work force in 2006 and 12 percent in 1996.

People are living longer, and fewer younger workers are coming into the labor force because U.S. population growth is slowing. Meanwhile, pensions have been replaced by 401(k) plans, leaving the responsibility of retirement saving and investing up to workers. Workers also have to be older to get full Social Security benefits — for a person born in 1955, it's 66 years old, versus age 62 for older workers.

Sharla Jessop, vice president of Smedley Financial, sees some clients who didn't plan for retirement early enough and who are battling the tough headwinds of the current market. "Their income is really being squeezed," she said.

Rob Ence, state director of AARP Utah, said that people getting ready to retire face challenges. Insurance coverage is expensive and tough to come by for unemployed workers over 50. And they face the difficulty of managing a 401(k).

Retiring is difficult for those people who don't make a lot of money, Ence said, and for those who didn't save enough when they were young.

And younger baby boomers also can't count on Social Security payments continuing forever. The federal Social Security program, which for decades has helped retirees, simply might not be around past 2040, "at least the way it's currently figured," said Sterling Jenson, regional managing director for Wells Capitol Management.

The market isn't helping matters. As of last week, the Dow had dropped a full 20 percent since October. That mark typically signals the beginning of a bear market.

The market's effects on retirement vary with individual cases. But 401(k)s dominated by stocks, or worse, a single-company stock, "have seen a significant deterioration in their valuation," Jenson said.

Market plunges have worried retirees and people who are nearing retirement age. The AARP survey found nearly one in five workers ages 55 to 64 planned to delay retirement because of the downturn in the economy. One-third of that group cited shrinking portfolios.

"We have seen an increased number of people ask about retirement," said Zan Hughes, branch manager of Fidelity Investments in Salt Lake City. "They're very concerned about it."

But the market's effect on someone's 401(k) is symptomatic of a larger problem, said Jeff Salisbury, principal at Independent 401K Advisors, a fee-only advisory firm with offices in Cache and Davis counties.

"I think frankly the real problem, and the thing that concerns me the most, is people, starting at younger ages, are just not doing the right things," Salisbury said. "As unsexy as this sounds, they're not saving enough."

Insufficient nest eggs

Forty percent of workers ages 45 to 55 say they have saved less than $25,000 for retirement, according to the Retirement Confidence Survey.

An increasing number are borrowing from what they have saved, according to the Transamerica Center for Retirement Studies' annual poll conducted late last year. Eighteen percent of those surveyed late last year admitted to such borrowing, up from 11 percent in 2006.

The trend is worrisome enough to grab the attention of some in Congress. Sen. Herb Kohl, D-Wis., who is chairman of the Senate Special Committee on Aging, has sent letters to nine overseers of 401(k) and retirement plans, seeking details on how they disclose fees and risks associated with rolling over or tapping into retirement accounts.

How much people will need in retirement varies.

Research shows a safe nest-egg withdrawal rate ranges from 4.5 percent to 5.5 percent a year, said fee-only financial adviser Denise Smith, a certified accountant and planner with Financial Planning Office in Salt Lake City.

Some older workers are finding that the nest egg may need a supplement, and they are returning to work.

Pauline Arellano works as a real estate agent. She is 74 years old.

"It's slow," the West Jordan resident said. "It's hard to find people who can really afford a down payment."

Arellano and her husband last month came to the Utah Department of Workforce Services in Salt Lake City to learn more about working for the U.S. Census. They thought it might be an interesting side job.

"The way the price of food and gas is going, we thought that if we had something extra coming in, it would be fine, it would help," said Chuck Arellano, whose part-time work in the medical-products industry recently ended.

Pauline Arellano says she isn't overly concerned about making ends meet.

But other workers are.

Jerry Walker, a retired auto-body paint specialist, said it's tough to make ends meet on retirement alone. A West Jordan resident, Walker is looking for a job. He has been at it two years.

"Older people — over 50 — they're not getting hired anymore," said Walker, who has 30 years of work experience and ran a forklift for 15.

His wife, Christine Walker, is partially retired. She works at Wal-Mart three nights a week.

"It's always tough to find a job," said Julie Swaner, program manager for Alumni Career Services at the University of Utah, "and it's tougher the older you get."

Seniors seeking jobs

The number of people looking for work after retirement age is increasing every year, said Mike Fawks, a job developer in Salt Lake City for the federal Senior Community Service Employment Program, provided through Easter Seals. The program gives job training and placement to low-income people ages 55 and over who have poor employment prospects.

Nationally, people ages 45 to 54 who are unemployed average 23.4 weeks in that state — longer than any other age group, according to a Bureau of Labor Statistics' Household Data report, released in May. People ages 55 to 64 spend an average 21.9 weeks unemployed. The national average is 17 weeks.

The number of Utahns ages 55 and older seeking job help from the Utah Department of Workforce Services jumped 10 percent from January to May of this year, to 3,900.

The department does not have job-placement numbers. But Walker, who in mid-June was looking on his own, guesses those numbers are not 100 percent.

"I get called on what I do, and when I go for the interview, that's the end of it. The only thing I can figure out is age. I know that ageism is out there," Walker said.

Fawks has little doubt some employers discriminate based on age. They want someone who is going to develop into the future, he said. And workers seeking to get back into the work force may need to update skills and training.

"The economy is not providing for people in retirement like it did 40 years ago," Fawks said. "People do have to supplement that."

For people who have to, or want to, work, re-entering the work force may be tough, but it's not impossible.

Between 5.3 million and 8.4 million Americans already have launched second careers, giving them needed income and a "social purpose" by working in nonprofits, health care and education, according to the 2008 MetLife Foundation/Civic Ventures Encore Career Survey of more than 3,600 people ages 44 to 70, conducted online and by phone this past spring.

AARP has established a National Employer Team to help connect retirees to companies "that value your experience and abilities." The companies are chosen based on hiring practices, opportunities and benefits offered.

Universities across the country, including the University of Utah, offer alumni career help, from resume preparation to interviewing workshops, for a nominal fee.

And some retirees do well on their own. Ray Nelson, a 61-year-old retiree from Murray, is putting his experience as a Salt Lake County sheriff's deputy to work at a private security firm. He has provided security for various public buildings and for the successful TV series "Touched by an Angel."

"It's just something to do," Nelson said.

Kathy Funk, who can't sit long due to a bad back, found work through the Senior Community Service Employment Program. She does secretarial and reception work for Easter Seals and says she can retire soon: "It's worked out great."

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