American Advisors Group (AAG), in its Post-2020 Retirement Survey, found that the pandemic had a profound impact on the lives of seniors across the country, with nearly one-third of those polled (30%) stated that the events of 2020 had a negative impact on their retirement plans and finances.
Lockdowns, virtual communication, and a fluctuating economy forced seniors to change their daily life and re-evaluate their future, as many were forced to draw additional income to fund their daily lives. More than one in five seniors (21%) said that the events of 2020 caused them to withdraw additional funds from one or more of their retirement accounts in order to survive the past year.
“Senior citizens make up our entire customer base, so it was important for us to understand how the events of last year affected their well-being,” said AAG Chief Marketing Officer Martin Lenoir. “This study showed us that not only are seniors still recovering from last year, but that they have a different outlook on the importance of their home. This may be the perfect time for them to bridge the gap and utilize their home equity to regain the peace of mind they had in years past.”
In terms of housing, 28% of seniors said they felt safer at home in 2020 than years prior, as lockdown and stay-in-place orders were mandated around the country since the outset of the pandemic. With the increased time spent at home, most seniors polled indicated that they have no desire to move, as 55% said they plan on living in their current home forever. Not only do most seniors want to remain in their home, many may be able to use it as a retirement nest egg. Nearly half of all the senior homeowners surveyed (47%) said they have paid off their house and are living mortgage-free.
“Most seniors still don’t realize that their home could be the solution for their financial needs and give them the peace of mind they are searching for,” the study concluded. “While the survey shows that many seniors are planning to work longer and look for alternative ways to increase cash flow, many could easily achieve a sustainable lifestyle by utilizing the home equity they have built over the years.”
A recent analysis from the National Association of Realtors, the 2021 Home Buyer and Seller Generational Trends report, found that seniors are joining forces with millennials in the purchase of multigenerational home–a home that will house adult siblings, adult children, parents, or grandparents.
“In light of the pandemic, many grandparents and older relatives found that being under a single roof–quarantining with family rather than away–worked out better for them," said Jessica Lautz, NAR's Vice President of Demographics and Behavioral Insights.