As David Levine and his wife sat down with their financial adviser this week in Cleveland, Ohio, they came to the same conclusion arrived at by millions of other workers: Market losses in their retirement accounts will force them to work longer.
"I would guess we're looking at just adding another five years with what we lost," said Levine, who owns an LED-lighting business he started two years ago.
"It almost seems like working is going to be a permanent thing. We either have to work longer or live shorter."
Levine's wife also runs her own business as a media coach for athletes and business managers.
Yet even with a household income exceeding $100,000, Levine, who is 41, said that he and his wife lost 40 percent of the principal in their retirement accounts.
Economic conditions have prompted the family of four to cut back spending on restaurants, travel and nonessentials.
"My wife and I laid out our expenditures, and I think like a lot of Americans our first reaction is disgust at how much money it takes just to live," he said. "I can't believe we need to make this much money to survive."
Their lifestyle changes are reflected in a survey released yesterday by the American division of Sun Life Financial Inc., which is based in Toronto.
The survey indicates that workers are paying down debt, cutting spending on restaurants and entertainment and planning to work past their planned retirement ages.
The survey completed in December shows that 54 percent of workers will delay retirement by at least a year because the economy has sapped their finances.
Nearly one-fourth said they will need to work more than five years.
The survey shows that as the economy worsened in the last half of 2008, many workers came to the conclusion that they would be forced to work past the traditional retirement age of 67 just to maintain their lifestyle and to keep health insurance.
"The level of pessimism about the economy is much more pronounced than we thought it would have been before we went into this survey," said Jon Boscia, the president of Sun Life Financial.
The survey, which was based on random telephone calls to 1,200 people on Dec. 3-14, has a statistical margin of error of plus or minus 2.8 percent.
The survey shows that 67 percent of respondents are reducing their spending.
Among them, about three-quarters said they are cutting spending on entertainment and eating out and more than half are putting off large purchases.
More than a third of those cutting back said they have canceled a planned trip or vacation, and 34 percent said they have delayed a routine or elective medical procedure.
The survey shows that workers in their 40s have been affected most by the recession, with 77 percent of those surveyed in that age group planning to work past 67 to keep health insurance coverage.
That's a 16 percent jump since the last survey was completed in August -- far more than any other age group.
More than a quarter -- 28 percent -- of the workers in that age group expect to work five years longer than planned.
"As we think through why they're the ones that seem to feel it most, our indication would be that they are experiencing the sandwich generation significantly," Boscia said.
They're called the sandwich generation because many workers in their 40s have children in college with tuition bills in addition to aging parents requiring more time and attention.
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