PrintJul. 26--After years of disciplined saving, Sharon Kerkman of West Jordan was on track to retire not long after turning 55.
But her December birthday has come and gone, and she's still on the job as a sales assistant for a financial services company. She estimates she will remain there, for at least another five to seven years, thanks to the worst financial downturn since the Great Depression.
Kerkman said her 401(k) balance -- which represents her entire retirement savings -- is off 40 percent from the stock market's peak more than a year ago.
"I'm pretty confident the market is going to come back," she said. "But I know it's going to just take some time."
Kerkman is among the growing number of Americans delaying their retirement plans because of the market's steep decline and a woeful economy that has prompted employers to ditch or freeze pension plans, cut contributions to 401(k)s and lay off or reduce the hours of their workers.
Others are confronting unexpected job losses, salary cuts and even business failures that are pushing off retirement to a distant, unknown future.
It has significantly altered or eliminated the plans of scores of 50- and 60-year-olds who once envisioned smooth sailing into retirement -- even early retirement -- while enjoying a few of life's luxuries along the way.
What they're facing instead are more years on the job and less of the fun stuff they thought they would be able to enjoy
after a lifetime of saving.
"Save harder and work longer, there's really no magic bullet," said Salt Lake City financial planner Paul Winter.
Kerkman has worked for 35 years, the last 21 full time in Salt Lake City while raising two children. After all those days of waking up at 4:45 a.m., "I'm tired," she said. "I had been looking forward to a part-time job, something fun, maybe do some volunteering."
Her husband, who is the same age, also has seen the value of his retirement account plummet. So they both could be on the job well into their 60s, "unless we win the lottery," she said.
In a survey released in June of more than 2,000 full-time workers, global consulting firm Watson Wyatt found that one-third have increased their planned retirement age in the past year.
Among those 50 and older, 44 percent said they were staying on the job longer than anticipated.
Those delaying retirement are doing so for reasons beyond diminishing retirement accounts.
For Dale Taylor of Lindon, whose account was heavily invested in international equities and the technology sector when it lost nearly half its value, the news got worse after his high-tech employer of 10 years laid him off, along with hundreds of others. In one way, though, he was lucky because he was given the option of relocating to the Phoenix area.
But in another twist, because of a number of issues that include a shared custody arrangement with his ex-wife, moving his family from Utah isn't feasible for at least three years. So, he's working in the Phoenix area while his wife and three children remain in Utah. Two of the three children live at home and attend college on full scholarships, which they would have to forfeit if they moved.
The cost of keeping two households is a financial burden, Taylor said. For him, such enjoyable activities as flying small airplanes are out of the picture for now, and so is boating. He didn't even bother registering his ski boat this year, and it's collecting dust in the garage. "Taking it on the lake for one day is $100 gas," he said. "We just can't spend that kind of money right now."
Taylor is economizing in other ways, such as telecommuting for work a couple of days of week to save on travel costs and carpooling on other days he has to drive to the office.
This isn't the first time Taylor, who is 49, said he has lost ground financially. While in his 20s and 30s, he planned to retire in his 40s. But he moved that well back after the dot-com crash of 2000, when he ended up losing money after being heavily invested in his employer's stock.
And today? "I'm going to have to work the rest of my life, basically," he said. "And that's fine -- I like to work, but what if I have a major health problem and can't work at some point?"
Midvale financial planner Ray LeVitre said even among those who can still retire on time, many are delaying retirement out of fear of what the future holds.
He has seen some people, ages ranging from 58 to 62, elect to work longer than they anticipated to ensure they will have a greater financial cushion against future downturns or recessions.
"Mathematically, it's a no-brainer. Every year you continue to work makes a difference," LeVitre said. "It's another year of not having to withdraw from your nest egg, It's one more year you're probably adding to your nest egg.
Those with a pension may get a slightly larger one if they work longer. Those who work longer also may be able to put off taking Social Security until their late 60s, which would result in a larger benefit than those who begin payments earlier.
Many people still are trying to cope with the new economic reality. Paul McGill was running a thriving 20-year-old business with his brother and not worrying a whole lot about retirement. The brothers did engineering-related work for steel fabrication companies. But their business relied on the commercial construction sector. When construction projects dried up with the recession, so did McGill's business.
Worry has become a constant companion for the Midvale resident. Business has been so bad that the brothers were forced to lay off their five employees, shut down their business, put their building on the market and apply for unemployment. Today, at 58, McGill is in the market for a new job.
"One of the hardest things was to let those people go who worked for you for so long," he said, adding that he's trying to help them find work, too.
Once he and his wife regroup and start thinking about retirement again, they know it will be a painful exercise in what could have been.
"I was just about to grab the brass ring, and then it all fell apart," he said.
On the plus side, McGill's wife, who works as a secretary for a school district, has health insurance, and the couple have saved enough to give him time to find another job.
Jay Leslie, 52, and wife Laurie Potter, 55, of Salt Lake City, know all about hard reality. They had planned to sail yachts in retirement -- he as the captain and she as a crew member or cook.
In December 2007, Leslie retired from a position in the parole department in Utah Department of Corrections. During much of 2008, he and his wife were in the Caribbean and other areas working to obtain the necessary sea miles, experience, formal training and certification needed to achieve their dream.
By the time they were finished late last year, the stock market had collapsed, their retirement accounts were down by about a third and so was the demand for yacht vacations and related jobs in that industry.
Not only did the couple have to abandon their dream retirement, but Leslie went back to work in the control room of the Salt Lake County jail, where he uses a computer to remotely open and close doors within the jail.
"Am I bitter? No, but I am disappointed," he said. "I understand that people are struggling, people are losing their jobs, and who can afford to drop $8,000 for a week on a boat vacation anymore?"
lesley@sltrib.com
Is your retirement account coming up short?
If so, you're going to have to save more money. Financial planners say there are four key strategies that work best (although they are no fun.)
-- Cut back on life's luxuries. Extra automobiles, boats, all-terrain vehicles and other toys cost money to buy, insure and keep over the long term.
-- Get frugal. If you aren't already, say, a coupon clipper, start clipping and paying attention to sales on food and other necessities. Shop to get the best prices.
-- Limit financial assistance to family members. Fund your retirement before you fund your kids' college education. They can borrow for college, you can't borrow for retirement.
-- Work longer. Even a part-time job in retirement can help ensure you don't outlive your retirement savings.
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