Older Americans more likely to leave work due to COVID-19, study finds - but not all claiming Social Security

The likelihood that Americans ages 55 and above would leave the workforce over the course of a year rose by 50%, according to a new study Boston College's Center for Retirement Research. The increase of 7.6 percentage points is in comparison to before the onset of COVID-19, signaling an unfortunate – albeit expected – effect of the crippling pandemic.

Those who were the most impacted include women, Asian-Americans, individuals without a college degree and people with difficult or absent work-from-home options, the study noted.

Americans who had to leave work or have their income reduced amid the pandemic can lower their monthly costs by paying down high-interest debt. In order to help mitigate and consolidate other debts, they may want to consider taking out a personal loan. Visit Credible to find your interest rate on a personal loan without affecting your credit score.

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Older Americans leaving work, but not drawing out Social Security

Despite migrating out of the current workforce, many of those Americans aren't subsequently tapping into their Social Security retirement benefits, the study found. It noted that actual retirement likelihood increased only by 1 percentage point, and that doing so was primarily among individuals age 70 and older.

"This discrepancy between leaving work and retirement can be interpreted in two ways,' it said. "Some older individuals may intend to return to work once restrictions ease and vaccination makes doing so safer. Others may not intend to return to the labor force, but are using other sources of income – such as extended unemployment insurance or federal stimulus payments – to postpone claiming Social Security."

Retirees can claim Social Security as early as age 62, however, their benefits will increase each year that they wait. Recipients can receive their full benefit amount once they reach the retirement age of 66. They can even receive a higher monthly benefit by retiring later and getting delayed retirement credits, which max out at age 70. Americans can set up their Social Security account to see their retirement benefit estimates at any age.

If you've recently left the workforce and are looking for ways to reduce your monthly expenses without taking your full retirement benefits from Social Security, consider consolidating your high-interest debt using a personal loan. Visit Credible to compare multiple lenders at once and choose the one with the best rates for you.

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When will older Americans return to work?

Many older Americans who are not using their Social Security benefits may potentially re-enter the workforce, however, that could depend on job availability.

"The policy implications of these patterns will depend on older individuals’ desire and ability to re-enter the workforce in the coming years," the study stated. "Even if most people who left their jobs want to return to work, the cohorts reaching retirement during the Great Recession expressed a similar desire only to find that jobs were not available."

The Center for Retirement Research suggested enacting new policy methods like eliminating the penalties for beneficiaries drawing Social Security out early. 

"If workers are forced to take early retirement, then policymakers could consider options to boost their financial resources," it stated. "For example, Social Security’s actuarial adjustment for early and delayed claiming currently over-penalizes early claimants (while rewarding delayed claimants), and could be adjusted to hold lifetime benefits constant."

If you've left the workforce, are living off benefit payments or your income has decreased, and you'd like to see what options are available for you to help lower your monthly expenses, you can contact Credible to speak to a lending expert and get all of your questions answered.

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