If you’re nearing retirement age and know you’re not financially prepared for retirement, your solution may be to work longer. While forgoing an early retirement can be prudent, your career might not last as long as you’d like it to. The pandemic and resulting economic conditions forced 1.9 million workers ages 55 and over out of the labor force in 2020. Even in normal times, health problems, family responsibilities, layoffs, and business closings can cause people to leave their jobs unexpectedly. The truth is that retirement isn’t always voluntary, and you could have to retire earlier than you expected to.
According to the Employee Benefit Research Institute, almost a third of American workers predict that they will work until age 70 or older, but only 7% of people surveyed actually ended up working until age 70. This can be an issue because older workers tend to have a harder time getting hired, and when they do, they often have to work for a lower salary. Spending what would normally be your highest earning years unemployed can be especially detrimental to your retirement plan, especially if you’ve waited to prepare for retirement until your 50’s.
And though your mind might be ready to work into your 70\’s, your body might not be. Workers are sometimes forced to retire earlier than they planned because of health issues. No matter how healthy you are now, anything could happen in the next few years. And, your job may be taking a toll on your health if it is physically demanding, requires you to sit for long periods of time, or lose sleep.
Even if your health remains perfect as you age, you might have a family member who requires your care, such as an aging parent, a spouse, or a grandchild. A loved one could require enough of your time and attention that you leave your job. Unfortunately, caring for your loved ones can be a time-consuming and unpaid job that might disrupt your retirement plans.
If you get hit with a retirement curveball, a financial advisor can assess your situation and help you create a plan. Don’t assume you’ll be able to work for as long as you want – unexpected job loss, health issues, and unexpected caregiving responsibilities happen all too often. To prepare for the unexpected, contact a professional. We can help you create a comprehensive retirement plan that may help you if you have to stop working earlier than you expected to. Schedule your no cost, no obligation financial review to get started on a comprehensive retirement plan designed for your lifestyle.