It’s not easy but nurses can be comfortable in retirement
IT’S International Nurses Day! The theme is ‘Nurses. Our future. The economic power of care’.
I will, therefore, in today’s article seek to address the financial future of nurses and how are nurses preparing for their retirement.
President of the International Nurses Council (INC) Dr Pamela Cipriano has referred to nursing as the “backbone of health care”. But, according to Dr Cipriano, the field of nursing is challenged by “financial constraints and societal undervaluation”. The INC is of the view that society can garner significant economic and social benefits if “strategic investment” is made in nursing.
There are nurses who are dissatisfied with their salaries as much as with their working environment and societal perception. One nurse I interviewed expressed concerns about the lack of resources to work with and the demanding nature of her job. She is 15 years away from retirement and is concerned about her plan for her future, financially. Though contributing to the government pension plan, she doubts her pension will be sufficient to meet her needs in retirement.
Chief among her concerns is the long delay experienced by nurses in receiving their monthly pension after they have retired. She cited situations in which nurses had to wait up to two years after leaving full-time employment before accessing their pension funds. According to her, some retired nurses return to work at lower ranks than the posts they held before. This situation can impact their mental health as younger colleagues may not view them with the high esteem that was shared before leaving the workforce. Some, however, have no choice as they, even in retirement, have monthly mortgage payments, motor vehicle loans, credit card debt, and other financial obligations.
The interviewee mentioned earlier disclosed that managing debt increases the stress level of nurses. There are instances in which one loan is used to cancel another and the vicious cycle of debt continues. She mentioned, too, that some nurses are not in a position to purchase a home until they are nearing retirement. Therefore they may need to delay retirement by re-entering the workplace after retiring, finding new career paths, or venture into entrepreneurship.
An increasing number of nurses globally suffer from burnout0 due to the emotional stress of patient care, working long hours, and workload pressures which affect their ability to take care of the patients as well as themselves.
That is among the reasons every year more Jamaican workers migrate in search of better-paying jobs, although globally countries seem to focus on recruitment of nurses rather than retention.
According to data from the United States National Council of State Board Nursing, “Over 50 per cent of the registered nurse workforce is age 50 and over.”
The State of the World’s Nursing (SOWN) report revealed that “one in every six nurses around the world is aged 55 and over”. With so many nurses nearing retirement, how prepared are they to enjoy life after nursing?
Research shows that some nurses who re-enter the workforce are not able to give quality patient care and their health is compromised due to the increased stress levels.
Nurses should start saving early for retirement. Some nurses regret that they didn’t start saving for retirement earlier as funds invested over decades of their working life would compound and yield a nest egg that they can enjoy in retirement. As a guide, nurses should consider saving up to 15 per cent of their gross salary for retirement. Small amounts add up, but retirement planning should start as soon as nurses start working. There will be competing needs such as homeownership, education costs, and household responsibilities. Nurses should consider opening investment accounts such as unit trusts and mutual funds, as pooled funds are less risky than purchasing individual stocks.
Diversification is important to minimise risk and maximise returns. Therefore, I encourage nurses to invest where possible in individual stocks and low-risk assets. Having a balanced portfolio of assets that will increase in value is important because of the varying financial challenges that are likely to occur.
There was the case of an American nurse who retired in 2007. She saved from her pay cheque every month during her career. During the many years working as a nurse she invested in individual retirement account (IRAS), certificates of deposits, stocks, and mutual funds. In retirement, she was a millionaire.
Nurses can live comfortably in retirement, but a professional and competent financial advisor will be needed to assist them to have the financial security that they deserve.
Grace G Mclean is a financial advisor and retirement specialist at BPM Financial Limited. Contact her gmclean@bpmfinancial or visit the website: www.bpmfinancial.com. She is also a podcaster for Living Above Self. E-mail her at livingaboveself@gmail.com.