Do you know someone that’s considering retirement, but since the economy lacks stability, they are continuing to work and postponing retirement? I know of quite a few people. In fact, since the stock market has taken its latest downturn, a few of these 60-somethings have expressed the statement to me, “Am I ever going to get out of this place?” – referring to their job of course. It really is sad, but many of the baby-boomers are choosing not to retire because they’re not sure that they’ll have enough money to last them for the rest of their lives.
MSN Money recently had an article that listed 10 reasons why many people are delaying retirement:
1) More time to save – working longer gives them an opportunity to put some money in the bank. Their kids are most likely out of the house and their expenses are way down, plus their earnings are most likely higher than ever.
2) Less retirement years to finance – this is sort of a no-brainer. If you work more of your life away, you won’t need to fund as much in retirement.
3) Health benefits – if you aren’t old enough for Medicare, reasonable insurance can be tough to find.
4) Improve your social life – since many of your friends are at work, staying on the job will enable your active social life to continue.
5) Protect your marriage – agreeing on a retirement age can be difficult, and then once you do that, changing the entire routine can be a struggle as well. By keeping things the same, it will be easier to stay together.
6) Stay involved – many people view retirement as sitting around and doing nothing. It’s easier to stay involved if you are working and around people.
7) Give something back – by staying at work, you’ll have the opportunity to pass your skills onto the younger generation.
8 ) Flexible Scheduling – you might choose to work, but with additional sources of income (such as Social Security), you might be able to pick and choose your hours.
9) Continue to delay taxes – since you are working, you most likely don’t need the additional income from your 401(k). By choosing not to withdraw right away, you won’t need to pay taxes until later.
10) Higher social security checks – by postponing your retirement, you’ll be able to receive the full benefit from Social Security, rather than just a percentage of the total.
What Do Most of These Points Have in Common?
More than half of the 10 reasons have to do with one particular subject, and I don’t think you’ll have to think to hard to discover what that one thing is: M-O-N-E-Y.
Of course, money is the problem! I think I may have heard that once or twice before…
If you are currently younger than 30 years old, remember this list. Perhaps it will give you a kick in the butt and cause you to start taking action on your retirement planning. Put some money in the stock market, but don’t bank on that alone. Consider investing in real estate, collectables, business ventures, as well as other opportunities that might come your way.
If you are older, is the lack of money keeping you from retirement? Rather than just admitting defeat and decide to work another 5 years, get creative! What is your passion in life? Perhaps the pursuit of your passion could be turned into a business venture on the side. This could be painting, sculpting, building, grooming, playing piano…ANYTHING! Any skill that you have can most likely turn into additional earnings.
A friend of my co-worker discovered late in life that he was pretty good with carving out wood to create portraits. He did a little carving in the evenings (after his regular job) and earned quite a lot of money. As the word spread, he soon had enough work to last him for over a year! He no longer needed the income from his job and could earn more money with fewer hours. Plus, he thoroughly enjoyed carving something out of a hunk of board!
Have you thought about retiring late in life? What was the reason? Have you thought of a better solution than ‘work an extra 5 years’?
My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.