Baby Boomers and Retirement: Navigating Financial Challenges
Overview of the Situation
As Baby Boomers transition towards retirement, they are increasingly confronted with financial pressures that may influence their decision to retire fully. The end of 2025 marks a significant milestone as many members of this generation, born between 1946 and 1964, will be eligible for their full Social Security benefits. However, current economic conditions suggest that many Boomers are opting to work longer or reconsider retirement altogether.
Current Retirement Status
Recent findings from Indeed Flex indicate that only about 10% of Baby Boomers are fully retired, despite the fact that approximately 60% of them qualify for full retirement age benefits by the end of 2025. Nearly half of those surveyed express intentions to continue working into 2025, prompted largely by concerns about the high cost of living and its impact on financial security.
Economic Pressures Affecting Retirement
The rising cost of living is a significant factor influencing the retirement choices of Baby Boomers. In January 2025, the Consumer Price Index (CPI) for individuals aged 62 and older increased by 3.1% compared to the previous year, outstripping the general CPI increase of 9.3% for all U.S. citizens. This trend raises urgent concerns regarding the adequacy of retirement incomes, particularly in the context of Social Security’s annual Cost of Living Adjustments (COLA), which have been criticized for failing to keep pace with inflation.
Challenges to Financial Security
Experts have voiced concerns about the sustainability of Social Security, which is facing potential funding challenges that may affect its ability to provide full benefits in the future. Novo Constare, CEO and co-founder of Indeed Flex, stated, “As the aging population heads into retirement age, many do not have enough money saved to live financially secure.” This informs the reality that modern retirees cannot depend solely on Social Security, as previous generations could with pensions.
The Path Forward for Boomers
In light of these challenges, a notable trend has emerged: approximately one in four retirees are contemplating reentering the workforce, often seeking temporary employment to supplement their retirement income. These temporary roles can provide crucial financial support for vacations, gifts, and social interactions, highlighting a proactive approach to managing financial needs.
