Seniors struggle with reduced income, no financial plan/The Coloradoan (Fort Collins, CO)
Sara Allen Gilbert (GreenPath group manager - Colorado/Wyoming)
7 May 2011

During the past several years, seniors have experienced many of the same financial worries as the rest of the population. Investments have declined and seniors are finding themselves working longer.

Almost 57,000 seniors age 55 and older completed financial assessments throughout the country with GreenPath in 2010.

More than a third of respondents (38 percent) listed "reduced income" as the main source of hardship.

Almost another third of respondents (29 percent) listing "no financial plan" as their source of concern.

A distant third reason for hardship was "medical issues" (disability, medical expense, etc.) with 12 percent of respondents listing it as their cause of hardship.

Surprisingly, "unemployment" placed fourth (9 percent) as a source of hardship.

Reduced income is a reality for seniors in our economy. Many people have had a lot of their retirement investments wiped out or greatly reduced during the recent economic downturn and are realizing their income has been greatly affected.

Many seniors must continue to work either full or part time because of health reasons or to help rebuild retirement money lost in the recession. Many people are finding it necessary to find part-time work to help out with their day-to-day expenses, as their investments start to build back up again. In addition, those who were able to retire recently have been faced with lower returns on their investments and Social Security.

Some seniors who didn't have a financial plan in place found themselves spending more money during the recession to support their lifestyle. While they might not be spending extravagantly, that uptick in credit card use to bridge their financial gap could add up quickly, putting them in a financial situation that they might have not experienced before.

Home values also have declined, which also is causing some seniors to have a more difficult time selling their home when the time comes to find more affordable or appropriate housing for their current needs.

Unfortunately, when seniors find themselves with a budget that does not balance, they are faced with fewer options than a younger adult. A senior typically has a harder time finding a second job or a better-paying primary job. They also often find themselves in a position where their income is fixed at yesterday's wages and their expenses are growing at the rate of today's inflation.

But there is help available to seniors with a free financial session with a certified counselor. Seniors should reach out early to a nonprofit organization before problems occur to review expenses and help them build a budget.

People need to get an understanding of where their money goes each month. They need to pay attention to monthly credit card use and balances and devise a plan to pay off that credit before the interest rates build up, causing an even further strain on their finances

GreenPath Debt Solutions offers free financial counseling in the areas of debt, debt management, budgeting, housing issues (including reverse mortgages for seniors), bankruptcy and more. Visit www.greenpath.com or call (970) 229-0695. GreenPath recently merged with the local Consumer Credit Counseling Service, so local counseling services with certified counselors are available.

Sara Gilbert is the Colorado group manager for the local GreenPath (formerly Consumer Credit Counseling Service), 1247 Riverside Ave., Fort Collins.