Published in Woonsocket Call on August 30, 2015
Today’s retirement age is not set in stone at 65 years old for aging baby boomers, the milestone age where their parents and grandparents retired from the workforce. Retirement Confidence Studies are finding that retiring in your mid-sixties is not a sure bet for many. According to WalletHub, a leading personal finance website, one such study, the Employee Benefit Research Institute’s 2014 Retirement Confidence Survey, found that 23 percent of workers expected to retire at age 65, but only 11 percent actually were able to.
The latest EBRI survey, released last April, said that many respondents blamed the nation’s poor economy for the continuing need to work in their later years. Others pointed to “inadequate finances” as another key reason for not retiring. For 51 percent of workers and 31 percent of retirees, their accumulated debt kept them at their jobs.
WalletHub adds, the Report on the Economic Well-being of US Households in 2014 prepared by the Board of Governors of the Federal Reserve System, says that 24 percent of the survey respondents are not at all confident at having enough money to finance a comfortable retirement. The government report also noted that 50 percent cited cost of living and daily expenses as obstacles for putting money into their retirement egg nest.
WalletHub calls for a strategy to slide into a more comfortable retirement for those whose nest egg is small, just relocate to a City to “stretch your dollar without sacrificing your lifestyle.”Sars by Relocation
WalletHub decided to pinpoint the most cost efficient and retirement-friendly places in the country because of the research studies indicating that feelings of financial insecurity have an impact on how retirees make decisions to save for retirement, says WalletHub Spokesperson, Jill Gonzalez.
For the second year in a row, WalletHub, conducted an in-depth analysis of the Best and Worst Cities to Retire. Like last year, the financial website compared the affordability, quality of life, health care and availability of recreational activities in the 150 largest U.S. cities. The compiled data included 24 metrics, ranging from the cost of living to public hospital rankings to the percentage of the population aged 65 and older.
“Our methodology makes the difference. It’s extremely well-researched and the metrics are developed in conjunction with academic experts that span several fields,” says Gonzalez.res
WalletHub’s 2015 Best and Worst Cities to Retire ranks Rhode Island’s Capitol City almost dead last as the worst place to retire. But, the City of Providence did place better than two of his cities, Jersey City and New Jersey.
Some of the metrics compiled from this survey include: Adjusted Cost of Living (122); Annual Cost of In-Home Services (140); Elderly Friendly Labor Market (80); Number of Adult Volunteer Activities per Capita (23); Percent of the Population Aged 65 and Older (132); Emotional health (144); Violent Crime Rate (78); and number of Home Care Facilities per capita (129).
Gonzalez noted that like 2014, in this years’ survey WalletHub compared the retirement-friendliness of the 150 most populated largest U.S. Cities (excluding the surrounding metro areas) across four key dimensions: Affordability; Activities; Quality of Life; and health Care. Twenty four relevant metrics were complied, ranging from the cost of living to the percentage of the elderly population to the availability of recreational activities.
“Every year we strive to improve our methodology by taking into account consumer feedback and industry trends,” adds Gonzalez.
It’s no surprise that when a financial web site publishes rankings, older industrial cities in the Northeast are at a disadvantage,” said AARP Rhode Island State Director Kathleen Connell.
“Some of the indicators where Providence comes up short are discouraging. However, many of the city’s greatest attributes – its arts and culture environment, community esources associated with world-class institutes of higher learning, proximity to Narragansett Bay and convenient travel distances to Boston and New York are but a few of the reasons people stay after retirement.
“There should be no confusing Providence with the state as a whole as a retirement choice. Granted, Rhode Island is more expensive than the sunbelt and in states where the housing market collapse has resulted in more affordable housing alternatives. And energy costs will always be higher in our region. That said, many downsizing retirees who value quality of life find a way to make it work. Others can’t, and we need to find ways to make retiring here more affordable. Eliminating the state tax on Social Security benefits was a step in the right direction, albeit in real dollars not a game changer for many retirees with limited resources. Affordable senior housing is a big issue and one of those challenges that requires urgent attention,” Connell added.
“The WalletHub analysis is useful insofar as it raises awareness and compels people to think more about retirement – and that includes both retirees as well as policymakers.”
“Although the WalletHub’s study is well conducted and well-respected in the financial sector, you have to look deeper into each of the categories when it comes to Providence,” says Edward M. Mazze, Distinguished University Professor of Business Administration, at the University of Rhode Island. “There are some unique factors that make Providence a better place to retire than one would guess from the survey,” he adds.
Mazze explains that economists who list, through national surveys, the best retirement places generally emphasize three criteria, specifically the cost of living, income, property and sales taxes and state/inheritance taxes. “When considering only these criteria, Providence and most cities will not rank high,” he says.
According to Rhode Island’s widely acclaimed economist, the state has made significant improvements in changing the income tax rates, raising the bottom on estate taxes and removing some social security benefits from state taxes which makes Providence a “great place to retire from a quality of life standpoint.”
For those retirees who want to live in a city that has four seasons, is strategically located near other major cities like Boston and New York, and want an active life-style, Providence meets the criteria,” he says.
Providence’s downtown area is also a site of parades, festivals and celebrations, says Mazze, adding that after enjoying these activities, retirees can dine at world-class restaurants. You might also add to your list the close access to over 100 beaches and 400 miles of coastline, bike and nature trails and historic sites.
While WalletHub’s survey may not show Providence as a top place to retire, the quality of life factors would ratchet up Providence into a higher rating.