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John Rodwick scrimps and saves so he can spend on his seven grandchildren and cruise around the Rocky Mountains with his wife, Jean, in their motor home. “My wife and I love to travel, so that is our one big expense, but we are very, very conservative” otherwise, says the 72-year-old former business professor. The couple doesn’t go to hotels or restaurants: They cook and sleep in their 19-foot, blue-trimmed Roadtrek. With the value of their home dropping 30 percent in the past six years, the Rodwicks have become “very cost-conscious.”

Federal Reserve officials say they are concerned that retirees like the Rodwicks are making it harder for the central bank to create more jobs for those still working. Older people are more likely to avoid purchases of houses, cars, and other pricey items that the Fed is trying to encourage with record-low interest rates. Their growing numbers are making the Fed’s job even harder.

“Spending decisions of the older age cohorts are less likely to be easily stimulated by monetary policy,” said William Dudley, president of the Federal Reserve Bank of New York, in a speech on Oct. 15.
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