GoFundMe Becoming the New 401(k) for Many Seniors

Gary L Hider / shutterstock.com
Gary L Hider / shutterstock.com

Ever since the start of the pandemic, stories of seniors being forced to work at Wal*Mart and not being able to retire flooded GoFundMe (GFM) accounts. While many of the stories were heartwarming and well-intentioned, it needs to be seen differently.

Poor planning and bad investments have forced many into this boat, thus making GFM more of a 401(k) for many. They lacked the insight and knowledge to properly plan for retirement, and now need to rely on the kindness of strangers to be able to live out their golden years. While these campaigns are started by well-meaning family members, they shouldn’t be a necessity.

From failed Social Security to people being forced into work that provides no retirement picture, it’s nearly impossible for many to prepare themselves properly for the retirement journey. With the political and financial climates going through decades of uncharted waters, many have been forced to take jobs at a place like Wal*Mart to pay medical bills or just to keep their homes. All these costs are a lot for many to shoulder, and they take what they can get.

It’s not just exclusive to Wal*Mart. This past holiday season GFM as well as network TV shows highlighted the campaigns of seniors at places like Burger King, Target, McDonald’s, and the Post Office as a part of their campaigns. While some of these companies offer plans, they often go under-offered by HR departments, or they have been hired with fewer hours than it takes to become eligible for those benefits.

Many of these seniors also took careers that don’t offer such perks. Without those accounts to help, and with many having kids who are unable to help in this financial climate, they have had little to no other options to survive. As it stands only ½ of the American workforce currently have a 401(k), and even working at an employer that offers such benefits is difficult to come across. The part-time workers who don’t get those benefits also rarely make enough to be able to save for retirement as it is.

John Scott, the retirement savings project director at Pew Charitable Trusts explained that there is a real lack of options for many. “Even when they’re participating, they’re not accumulating as many assets as workers in better paid jobs.”

Teresa Ghilarducci, a labor economist at the New School has also taken a harsh look at the GFM rush for seniors. “This is not a feel-good story; this is about the failure of our retirement system.”

It’s also a problem she doesn’t see how we can all fix. “I figure that we have 3.9 million people in America now who are working over the age of 70 who need GoFundMe accounts. And that’s just not a practical solution to this problem.” People working at this age and older are sometimes doing so because their Social Security payments — which average about $1,100 a month — don’t go far enough.”

The one plus side to the GFM rush has been the highlight of some seniors who have benefitted from it. Stories like the 100-year-old yoga teacher, or the seniors waiting tables in small restaurants in rural America. By shedding a light on the invaluable work so many seniors provide, it got more attention from the American people to those who rarely get enough of it. Far too often the seniors are like the homeless and overlooked unless we need something or just want some pity.

With policy changes from companies and better investment tools being made available, this can change. We can start to stem the tide and help the next generations of seniors not go through this. It will take time and a lot of effort from people and businesses across the board, but we can change the way seniors live.