Three in four older adults faced significant financial hardship for at least six months while they moved from their longtime line of work into an “encore” career helping others, and one in three endured such difficulty for more than two years, according to a new survey.
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An estimated 31 million people ages 44 to 70 are interested in transitioning to socially oriented encore careers, according to the MetLife Foundation and Civic Ventures, which jointly commissioned the survey. But respondents’ answers suggest that about 40 percent are staying put because of financial problems.
The study was conducted in June through October 2011 to learn how older people viewed such careers, which typically involve doing work for the greater good. Included are jobs at schools, public agencies and nonprofits advocating for social causes.
More than 900 older adults were polled by telephone and about 1,800 were surveyed online to garner a nationally representative sample, according to researchers at Civic Ventures, which focuses on boomers, work and social purpose.
“The loss of income was very significant … and jumped out at us as one of the big challenges,” says Jim Emerman, executive vice president at Civic Ventures. “People didn’t have much in the way of resources to turn to and there aren’t many programs” available to help people move into those kinds of jobs.
Lisa Roger, 53, knows that first-hand. She got laid off from her job as a software engineer three years ago and began volunteering for an Alzheimer’s association. “It whet my appetite to do something more meaningful,” she says.
She didn’t have the skill set necessary for the new kind of work she wanted. So she dipped into her savings and took a “skills transitioning training program” at the University of Connecticut, for professionals seeking to move into the nonprofit world.
She landed a job at a government agency helping low-income adults with housing issues.
“I don’t make nearly the salary I did and I’m OK with that,” she says. “I have good health benefits and the work is incredibly rewarding. I know I’m making a difference and at the end of the day it’s a great feeling.
“I used to feel I’d retire before 65,” she says. “Now I expect to be doing this beyond that.”
The report offers recommendations to smooth such career transitions, including:
- Financial advisers can help people plan and finance their transition long before they’re ready to make the switch.
- Savings options like an “individual purpose account” could be developed to help people finance these transitions, perhaps with a tax advantage.
- Financial aid should be made available for those seeking training for roles in the nonprofit or public sector.
- Corporations or nonprofits can create paid fellowships, which include a stipend and health benefits for six months, to open the door to these careers.
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