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Retirement Planning > Saving for Retirement

Should We Worry About Older Workers With Nontraditional Jobs?

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Bring up the topic of older workers in nontraditional jobs, and you’ll hear a range of opinions.

Some policymakers worry that workers’ finances are vulnerable to health shocks because they lack health insurance, and they’re concerned that lack of retirement plans will hamper their savings.

Others point out that workers may use nontraditional jobs as stopgaps between more traditional employment or as a way to extend their careers after typical retirement ages. Or, they hopefully opine, perhaps these workers have access to benefits from family members or public programs.

All this boils down to the question: Should we worry about nontraditional jobs?

Boston College’s Center for Retirement Research sought to answer the question by examining four of its recent studies on nontraditional jobs and older workers.

Definitions of nontraditional jobs, the CRR noted, include “gig economy” jobs where workers receive 1099 tax forms for self-employment and/or jobs involving part-time or temporary work.

Researchers found that indeed there is some room for concern about such jobs.

Revealing Findings

The research showed that most 50- and 60-year-olds who work nontraditional jobs do not appear to be doing so as bridges to more traditional work. Rather, they tend to spend most of these pre-retirement years in jobs without benefits. 

They generally do not find an alternative way to save for retirement, a problem that may worsen if automation continues to threaten some of these jobs.

That said, however, nontraditional jobs do help workers in the 60s improve their financial position, the research found.

The CRR suggested some priorities for policymakers.

One, ensure that certain features of the Affordable Care Act, in particular Medicaid expansion, thrive in the future. Researchers noted that the ACA appears to have reduced lack of coverage among workers without employer insurance.

Two, extend easy access to retirement savings vehicles to more workers. The CRR said some states have programs that automatically enroll workers without a retirement plan at work into an IRA, and evidence indicates that they do participate and accumulate savings.

Three, continue to encourage workers to extend their careers into their 60s, if nothing else by using nontraditional jobs. The CRR pointed out that working longer is one of the best ways to improve retirement security.


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