In order to save enough money for retirement, households with older individuals need to save more and possibly plan to work longer, according to research reported by MarketWatch retirement columnist Robert Powell. Thus, hopeful retirees are turning to self-employment.
The research cited, authored by Christian Weller, a University of Massachusetts Boston professor; Jeffrey B. Wenger, University of Georgia professor; Benyamin Lichtenstein, a University of Massachusetts Boston professor; and Carolyn Arcand, a University of New Hampshire professor, states that the same labor market pressures that have made it harder for people to save, such as increasingly unstable labor markets, have also made it more difficult for people to work longer as wage and salary employees.
“Self-employment hence may have become an increasingly attractive alternative option for older households,” the authors wrote in an abstract of the paper. “Entrepreneurship among older households has indeed grown faster than wage and salary employment, especially since the late 1990s. But, this growth, rather than reflecting rising economic pressures, may have been the result of growing financial strengths—fewer financial constraints and more access to income diversification through capital income from rising wealth.”