Retirement is an exciting prospect. You have likely dreamed for decades about the trips you’ll take, hobbies you want to take up, and relaxing mornings getting coffee with friends. But what happens when you look at your financial calculations and discover you don’t have enough to live the life you’ve been dreaming about? For many people in this predicament, the simple answer is to just work longer and postpone their retirement. However, this isn’t always the best strategy.
According to the 2021 EBRI Retirement Confidence Survey, there is a considerable gap between when a person expects to retire and when they actually retire. While 26% of respondents stated they would like to retire at age 70 or older, only 6% followed through. Most end up retiring earlier and often it’s not by choice. There’s nothing worse than being forced into retirement before you’re ready. Even if you want to work longer and save more, there’s no guarantee you’ll be able to do that.
Let’s look specifically at a few reasons why retiring later is not a reliable strategy.
Unexpected Health Problems
Even if you are the picture of health today, you never know what will happen in 5, 10, or 20 years. As you age, your health can suffer. Working longer is not a guarantee, as 34% of retirees in 2021 were forced to retire early due to a health problem or disability.
Your Company Downsizes
It is incredibly disheartening if you are in the last few years of your career and your company downsizes, leaving you in the dust when you were counting on the income to provide for you in retirement. In fact, 25% of retirees were forced into early retirement due to changes at their company. At this stage of life, it’s challenging to find another job when prospective employers know you will be retiring soon. While you can keep your skills sharp and take measures to prove your value to your current employer, you just never know what will happen to your company as the years go on.
Your Family Needs Your Help
Your loved ones are aging right along with you. Even if your health is excellent and your company still needs you, you may need to step back from the workforce earlier than planned to take care of a spouse or other family member. Your family comes first, so you don’t want to feel the pressure of working just to have enough in retirement if the unexpected occurs. It’s not fun to plan for contingencies like this one, but having a proactive mindset can help you prepare for the worst-case scenarios leading up to retirement.
You Might Just Need a Change
When you’re in your 50s and still have years to go before you retire, it may seem simple enough to push out your retirement date from 65 to 70. But what happens when, at 63 or 64, you can’t imagine working for another six or seven years? If you were banking on working until 70, you might not have enough saved.
The younger you are when you retire, the more energy and health you’ll have to enjoy retirement. Many retirees regret spending their best retirement years grinding away at work. Sure, they had more money when they finally did retire, but they had less time to enjoy it.
Since you can’t predict the future, how should you plan?
Start With a Plan
Even though we’re talking in hypotheticals and there’s a good chance you can retire when you want to, the peace and confidence you experience with a plan in place pays off in the long run. This is your future; don’t take chances by waiting to build a plan. Our team at Horizon Planning Group is ready to help you create the retirement plan that can allow you to live your dream retirement. Utilizing our extensive experience and knowledge, we are committed to partnering with you to help pursue your goals and realize your dreams. Schedule an introductory meeting online or reach out to me at (770) 627-4157 or Scott@MyHorizonPG.com to get started.
About Scott
Scott Bechely is financial advisor at Horizon Planning Group, a full-service fiduciary financial planning firm committed to always doing what’s right for their clients. Scott uses his more than 15 years of experience to help his clients create a retirement income plan that aligns with their goals and helps them live the retirement lifestyle they dream of. He believes that everyone should have a chance to obtain financial independence, and he strives to help his clients design a plan that helps them sleep better at night knowing they’re on track for their ideal future.
Scott is a CERTIFIED FINANCIAL PLANNER™ professional who graduated magna cum laude from the University of Georgia with a bachelor’s degree in business administration, focusing on finance. Outside of work, he can often be found spending time with his wife, Sara, their daughter, Anna, and their dogs, Ginger and Bailey. He loves sports and enjoys playing in his baseball league and golfing. He gives back to his community by supporting his favorite dog rescue organizations: Adopt A Golden and Golden Retriever Rescue. To learn more about Scott, connect with him on LinkedIn.
This is for educational and informational purposes only and is not research or a recommendation regarding any security or investment strategy.
The information given herein is taken from sources that IFP Advisors, LLC, dba Independent Financial Partners (IFP), IFP Securities LLC, dba Independent Financial Partners (IFP), and its advisors believe to be reliable, but it is not guaranteed by us as to accuracy or completeness. This is for informational purposes only and in no event should be construed as an offer to sell or solicitation of an offer to buy any securities or products. Please consult your tax and/or legal advisor before implementing any tax and/or legal related strategies mentioned in this publication as IFP does not provide tax and/or legal advice. Opinions expressed are subject to change without notice and do not take into account the particular investment objectives, financial situation, or needs of individual investors. This report may not be reproduced, distributed, or published by any person for any purpose without IFP’s express prior written consent.
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