6 Reasons To Consider Delaying Retirement

If you’ve been dreaming of retirement since you entered the workforce, you might have some idea of ​​what it looks like when you’re no longer working. But there’s a chance you might not start retirement when you thought you would, perhaps due to circumstances beyond your control.

About 40 percent of workers are planning to push back retirement later in life because of inflation, says a recent survey by the Nationwide Retirement Institute. While life doesn’t always go according to plan, would-be retirees can make the best of a bad situation by delaying retirement. So if you’re on the fence, here’s why you might want to consider retiring later than you originally thought.

For many retirees, $1 million is the magic retirement savings number, but Americans in general are nowhere near that figure. According to Vanguard’s “How America Saves 2022” report, workers aged 45 to 54 in Vanguard retirement plans had a median of $61,530 at the end of 2021. Those aged 55-64 had a median of $89,716 in their plans.

Delaying your retirement gives you more time to save for your golden years and less time to live off your savings. Many retirees fear that they will run out of money before they die, so the more time you spend saving, the less dependent you will be on that savings when the time comes to stop working.

While you can claim Social Security as early as age 62, the later you stop it, the more you can eventually claim. Waiting until full retirement age or all the way until you hit 70 years of age can significantly increase your benefits. For example, people with a full retirement age of 67 can increase their monthly benefits by 24 percent if they wait until age 70.

Withholding Social Security means you’ll need to make up for the potential loss of income. Without a solid nest egg in place, you may have to delay retirement longer than you anticipated. Continuing to work might be your only, or primary, source of income for a while longer. In the meantime, however, you’ll be locking in some more Social Security COLA increases while you’re at it.

If you’re happy with your job and otherwise happy with work, you don’t have to stop once you hit a magic number. Not everyone loves their job, and many are looking forward to the day they no longer have to go into the office. But if you’re satisfied, don’t feel compelled to stop.

Apart from income, work has many other benefits for emotional, psychological and mental health. Older workers do not need to stop working at a certain age, especially if they enjoy it.

While the income is useful, a job typically provides other benefits as well. For example, you might have an employer-matched 401(k) program. If you don’t qualify for Medicare, you can still count on health care benefits. These benefits could be better than those offered in the ACA health care exchanges, or at least for much less than you would pay.

Some workers may receive other benefits, such as reimbursement for continuing education, gym memberships, reimbursement for certain bills and more. If you want to keep certain benefits that you can’t get if you quit your job, you might want to stick around a little longer.

With inflation at multi-decade levels, rising prices are hurting everyone, including early retirees. Again, with some 40 percent of respondents pushing their retirement due to inflation, according to the Nationwide Retirement Institute’s latest survey, it may make sense to wait out rising prices and make sure your finances are on a stable footing before you go. in there next step.

While you wait, use Bankrate’s retirement calculator to find out how long your money will last.

For various reasons, your original retirement plan may not have worked out the way you thought it would. For example, you may not be able to downsize due to an uncertain housing market. Or you were laid off during the pandemic and had to find a job that wasn’t what you traditionally did for work, so you’re making up for lost income now and have to keep working.

Maybe you wanted to move to be closer to family, or health concerns suddenly ate more of your budget than you expected. Whatever the reason, you may not be able to retire now and may need to reevaluate your plans or consider alternatives, such as working longer.

Bottom line

Retirement is not a path for everyone. If you have to delay retirement because of something you didn’t expect or things didn’t go according to plan, don’t worry. If you feel stuck and can’t see a way out, you may have more options than you think. Take some time to review your choices now so you can chart a path for your future retirement. And if you are looking to avoid this situation in the future, but how much you should have saved in each age to stay on track.

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