Many household heads of retirement age would like to stop working; few can afford to do so comfortably. Of households with heads age 55 and older, almost two-thirds are retired—some by choice, and some as a result of downsizing and layoffs. Almost one in five households are not retired and not preparing to retire; slightly more than one-quarter of households are not retired but are preparing for retirement. Almost 20% of households age 55 or older are Revolving Retired—a combination of household heads who have gone from full-time to part-time work, retirees who have gone back to work full- or part-time, and retirees who plan to return to the workforce. Revolving-Retired households are the focus of this summary. The tables and charts for November 2013 compare all retired-related populations; an Excel file of tables and charts is available on request.

Demographics

The majority of Revolving-Retired households are middle-class households. Several factors shed light on why many are not fully retired: household dependents, a family member's lack of government-sponsored health-care coverage (Medicare), insufficient retirement funds, and higher levels of debt.

• The mean age of the primary household head is 66; mean household annual income is $64K. Almost two-thirds are in the high-middle and high socioeconomic levels.
• Roughly one-third have a high-school diploma or less, one-third have some college, and one-third have a college or postgraduate degree.
• Slightly more than one-half are married; 19% have dependent children, and 17% have dependent adults supported by the household.
• Seven in ten live in a single-family dwelling; four in five own their home. One-quarter live in a suburb of a large city, and one in five live in a rural area.
• Almost three in five households have a member on Medicare—average in comparison with all households with heads age 55 and older.
• They are above average (26%) for having no end-of-life documents.
• They are more likely than average to own or to be part owner of a business or professional practice; 15% are owners or part owners.

Financials

Revolving-Retired households don't have quite enough in savings and investments to retire successfully.

• Net worth ($487K) is lower than for retirees ($598K) or households preparing for retirement ($745K).
• They are more likely than average to have a mortgage on other real estate and consumer loans (20%).
• One-third have an investment account; they prefer full-service accounts two to one over discount stockbrokerages, although they are more likely than average to have a discount-stockbrokerage account.
• Their mean value in investment accounts ($401K) is lower than average.
• They are below average for owning individual life insurance. Mean annual expenditures for most types of insurance are slightly lower than average.
• Their mean balance in retirement products ($225K) is below average. Annuity ownership is average; 22% own any annuity.
• The majority (76%) consider a bank primary. However, only 55% prefer a bank as their primary institution.
• They are more likely than average to use a walk-up window, speak with an institution rep on the phone, use a touch-tone phone service, and use an ATM.
• They are average for internet use for financial services and above average for activities other than checking account balances, paying bills, funding transfers, or reading account alerts; they are above average in mobile use to access their accounts.

Financial Attitudes and Tidbits

The majority of Revolving-Retired households are no more or less likely than average to agree (net) with most of MacroMonitor's 135+ financial attitudes. However, the exceptions are notable because they support the popular belief that many forever-young Older Boomers—who grew up in prosperous post-WWII years—are starting to face a dose of reality after years of self-indulgence.

• They are more likely than average to look always for the lowest-cost financial service (68%); they are also more likely than average to take substantial investment risk to reap substantial gain (21%).
• They are more likely than average to agree that it's better to enjoy money now than save for old age (27%), but at the same time, 59% worry about outliving their savings and investments.
• The reality is that 37% feel as though they're living on the edge, and only 54% are in a position to meet their long-term financial goals. Seven in ten are concerned about living within a fixed income; 60% agree they don't have as much life insurance as they should; only 18% have an employer that would pay wages for as long as they were unable to work.
• They are significantly more likely than average to show interest in a savings plan for their children's education (19%).

Implications

A portion of today's Revolving-Retired households portends significant changes to come even if the incidence of revolving-retired households does not increase. Current Revolving-Retired households include the vanguard of Older Boomers. As more Older Boomers are unable to retire successfully, the proportions that use technology for financial services and who are disengaged will likely increase. Roughly half of current Revolving-Retired households used no sources for financial-product, service, or decision-making information in the past 12 months, and 45% are not interested in learning more about any financial topics. It's time to think outside the box. Plenty of opportunity exists for financial-services providers among Revolving, Retired, and Preretired households.