There was a time when we frequently heard about workers taking early retirement. But these days, it’s pretty unusual. In fact, even retiring on time is becoming less and less common. For various reasons, many senior workers are opting to stay in the workforce longer.
Some who are approaching retirement age fear that they will become bored and depressed if they stop working, so they stay on. Studies have shown that many individuals are happier and healthier with the continuous challenges and structure of their jobs and careers.
But in most cases, the decision to delay retirement is mostly about finances. Here is some advice that you might want to consider about delaying retirement.
You Didn’t Put Enough Money into Your Retirement Fund. With a growing number of retirees living decades past retirement age, you need a substantial nest egg to ensure that you’ll have enough money to live on for that long. And if you skimped on your 401K contributions, got started late, or made withdrawals and didn’t pay them back, it’s quite possible that you didn’t save enough. Working a few more years will give you some added security.
Your Investments Lost Value. This is an all too common scenario in troubled economic times. Even those who realized the importance of saving as much as possible for retirement at a young age can find themselves without enough money to retire on due to fluctuations in the stock market.
You Need the Health Insurance. You will be eligible for Medicare when you reach retirement age, but there are some things that Medicare doesn’t cover. These include prescription glasses, hearing aids, dental care, private nursing care, outpatient hospital visits and preventive care. If you have needs that will not be covered, you may need to keep working so that you can keep your health insurance.
You Haven’t Paid Off Your Debts. If you purchased a home or refinanced your mortgage late in life, or you accumulated a great deal of credit card debt, you may find that you haven’t yet paid it off in time for retirement. Continuing to make debt payments after you’ve stopped working could eat up your savings in a hurry. It might be a good idea to delay retirement until you’ve paid off your debts, or at least long enough to build up your savings a little more.
Delaying retirement doesn’t necessarily mean that you have to keep toiling away forty hours a week for the rest of your days. Many employers are willing to work with their employees who are reaching retirement age. Your boss might modify your duties, let you telecommute or reduce your hours. You might also consider doing part-time consulting work or building an online business to keep the income flowing after leaving your primary job.
It’s crucial to be realistic about whether or not you can afford to retire. If you’re not, you could find yourself in a bind several years down the road. And by then, returning to work might not be an option.
Tags: delay retirement, retire, retirement advice, retirement planning