Unemployment Over 55: Early Retirement or Find a Job?

People are losing jobs. It’s what happens when the economy takes a turn for the worst. For those over 50, right now can be a downright scary atmosphere. Not only are people losing jobs, but it’s getting harder for those over 50 to get either their old jobs back or a similar job. This was true back after 2009–after the most recent recession–and it’s true now. For many people over 50, especially those over 60, they may just choose to stay jobless after all this is over; they’ll essentially retire. They will effectively be forced into retirement. Now, that doesn’t sound like the worst scenario, but it can be a nightmare. Imagine saving up for a particular retirement and setting plans and goals and then being forced to start tapping into your savings years before you intended to. Suddenly, that nest egg might not seem so large and you weren’t mentally prepared to exit the workforce. This probably is not ideal for many and will likely cause many older Americans to start tapping into their retirement funds sooner than anticipated. It will also force many Americans to reassess their retirement plans and to make changes to how they planned to live out retirement. It can be somewhat traumatic to have to change plans that you had been working towards for years, or even decades. If you do find yourself facing an early retirement, don’t freak out. Take a deep breath and think about the options available to you and whether they fit into your life plans. Can you get by on unemployment for a while? Is now a good time to switch industries or find work in another area? Would it really hurt to start taking money out of your nest egg now? Thinking about these questions can help you either fight the urge to retire or allow you to slide into retirement in a calmer mood.

Thinking Beyond Money When Deciding to Retire

Yes, your finances are a crucial part of your decision to retire. After all, you really can’t retire until you have enough saved up to support yourself. However, money shouldn’t be the sole reason you decide to retire. There are other aspects of retirement that need to be considered as well when deciding whether to retire. Such topics include what you plan on doing in retirement, whether you are socially prepared for retirement, and whether you have proper health insurance/medical care plans. These topics won’t overtake finances when it comes to being comfortable enough to retire, but they can have a big role in how long your nest egg lasts and how much you enjoy retirement. For example, if you don’t have plans for how you will cover your medical expenses in retirement, you could be putting your nest egg at risk as medical bills can really add up, especially as you age. Those bills could eat into your savings and leave you with a shortage in the future. The social aspect of retirement is also often overlooked. Leaving the social structure of an office environment can be a tough adjustment for retirees, particularly when the office is an important part of their social life. Make no mistake, retirement can be a lonely time without a good social network to enjoy it with. For retirees living far away from family, it can be even more difficult. Therefore, as you contemplate retirement, you should take time to think about more than just the financial aspects of it. Even if you find that you are financially ready for retirement, you may find that you’re not socially ready to do so or that you just don’t want to stop working.

Are You Serious About Working During Retirement?

Many peopleĀ say they plan to continue working during retirement, but few actually follow through with such intentions. In fact, according to research recently done by the Employee Benefit Research Institute, about 80% of future retirees say they plan to keep working in retirement. Do you know how many actually do? A little over 25%. That’s a pretty big discrepancy. Now, there are various reasons why people don’t end up working during retirement–from health issues to not finding a job that they are suited for. If you are really serious about working during retirement, though, you should take steps before you retire to increase your odds of finding employment. If you plan on remaining within your field–many retirees get into consulting work for the flexibility–you will want to make sure your skills and abilities remain current. While this is something you probably do throughout your career, it’s particularly important as you grow older as it can help you remain relevant and appealing to potential clients and companies. Now, many retirees go the opposite route and decide to start a business during retirement, often outside their original career. If this appeals to you, you should again take steps before you retirement to make it a reality. That means obtaining any necessary financing while you are working and taking the steps to incorporate or build up your business before you retire. This can help you to make sure that you are covering start-up fees and costs while you are still earning income and can allow you to make sure that the business you are starting is right for you. Now, regardless of what you decide to do for work during retirement, you will want to have a network to turn to to help you either gain customers or find work. You should be building that network up well before you hit retirement so that it can be easily tapped when you need to do so. As you can see, there are pre-retirement steps you should take if you plan on working during your twilight years. Working in retirement can be fulfilling and a great way to stay active and sharp as you age, which can provide added health benefits and a longer life. However, just make sure that working in retirement is right for you and that you take the steps to set yourself up for success in doing so.

Having Purpose in Retirement

For many retirees, retirement isn’t all that it’s trumped up to be. Retirement can in fact be a very lonely, depressing, and anxious experience. So much of retirement planning is centered around finances and goals that it’s easy to overlook other important aspects, such as how retirement may affect your social life and what keeps you fulfilled in life. For example, many retirees struggle with the social consequences of leaving the workplace. For many people, the daily interactions they have–and the relationships they maintain–with co-workers and clients are an important part of their social lives. Some retirees may not realize how depressing and lonely life can be without those interactions. Another area that many retirees struggle with can be the sense of purpose that work can provide. It can be quite jarring for some and can lead to depression and anxiety. This can be even more evident for those who are pushed into retirement early than intended or whose jobs are a vital source of purpose and fulfillment within their lives. Therefore, it’s important that as you plan for retirement, that you take time to reflect on what is important to you and what provides fulfillment to you. If there are certain things that are important to you, make sure to build them into your retirement plans. For example, if you worry about having purpose in retirement, then focus on doing things that give you purpose. Things such as getting involved in a social group or volunteer work can provide purpose and fulfillment. Another great way to find purpose is through hobbies and new interests. Not only can such activities provide satisfaction, but they can also keep you active. Remember, purpose–the happiness and satisfaction it brings–can be just as important to retirement as your finances and nest egg, so don’t forget about it while planning for retirement.

Don’t Forget About Your Career While Retirement Planning!

Your retirement goals and plans are important, but you will never reach them unless you have a career with which to fund such pursuits. Having a stable and lucrative career is fundamental to the retirement saving game. If you don’t earn enough then you are going to have an awfully hard time saving for life after you stop working. Thus, it’s wise to make focusing on your career a part of your financial and retirement savings plans. This means making sure that you stay relevant both in your field and at your place of employment. You can do so by staying on top of the latest trends and best practices as well as keeping an eye on the industry in which you work. Who is doing what? How is your company performing relative to others in the field? Are your skills up-to-date? If you work for a large corporation, you should keep track of what the company is doing and how they operate. Is management consistent in its decision-making? Are there particular hiring and promotion trends you’ve noticed? How is the company discussed in the media? Answers to questions like these can give you a sense as to whether you may need or want to consider making a move to another company or another industry. Such a move can pay dividends as you may end up in a better paying position or at a company that is trending upwards with more opportunities for professional growth. A mid-career move can also be a personally and professionally revitalizing moment that can help to rejuvenate your career and allow you to refocus your goals. It can be easy to set your career on cruise control, especially after a few decades in a particular field, but that can be setting yourself up for heartbreak and pain. For example, you may overlook a looming layoff or may not see the signs that your employer is in a downward spiral. Remember, your earned income is what drives your retirement savings and financial plans, so it’s vital that you maintain it (as well as take advantage of opportunities to increase it) as best you can.

Are You Truly Ready to Retire?

If you’re within a few years of your intended retirement date, you’re probably starting to convince yourself that you are ready for it. You probably talk to friends and family about how long you’ve worked or how you’ve saved enough–or just about enough–to no longer need a paycheck or how you’ve started looking forward to the day you retire. If you aren’t near retirement, perhaps you’ve heard an older family member or co-worker talk like that. While it’s true that one may be financially or professionally ready to retire, that does not mean that one is necessarily physically or mentally ready to retire. It’s not unheard of to find retirees going back into the workforce after a few months or years in retirement. Sometimes that may be for financial reasons, but it can also be out of boredom with retirement. Yes, people get bored with retirement. After all, there are only so many rounds of golf that can be played or so many hours that can be spent in the garden or so many trips to be had (just to name some common retirement activities). This is especially true for younger retirees who tend to be more active and healthy than older retirees. It’s also not uncommon for people to not realize that retirement boredom is a possibility until they actually retire. While there is nothing wrong with this, it does mean that they may have tapped into their nest egg and used money that they could have instead kept saved if they had planned better. This is why it’s important that you really make sure that you are ready for retirement. This means doing some self reflection and thinking about your plans for retirement. Is there a possibility you may get bored with retirement? Do you have definite plans regarding your retirement? Do you want to keep working, but if a different field or with more flexible hours? Are you unsure of what you really want to do with your retirement? Such questions and reflection can help guide you to make the choice regarding retirement that is right for you. Who knows, you may find that you really aren’t ready to retire and that you just need a change of scenery career-wise. On the flip side, you may realize that you really do have plans for retirement that don’t involve working and that retirement is the right move for you. Whatever you decide, just make the decision that you feel is best for your life.

Could You Handle Retiring Sooner Than Anticipated?

While you may have plans to retire at a particular age, life and your career may dictate otherwise. Certain scenarios may arise that may force you to think long and hard about retiring sooner than anticipated. A major company restructuring or other organizational changes may make retirement seem more appetizing than continuing working. Furthermore, general discontent with your career can be another driver of the decision to retire earlier than intended. If you’ve been consistent with your retirement saving and focused on saving as much as possible, you may be okay, especially if you are within a year or two of your intended retirement age. However, if you find that you’re considering retiring more than a few years earlier than intended, you may have some struggles ahead of you and you may need to think about ways to potentially alleviate those issues. If you are in a situation where you think that you may run into a scenario where you may retire sooner than you’d like–for example, your company has a policy or reputation of forcing people out at a particular age–you will want to start saving for that possibility sooner rather than later. That means taking advantage of catch-up contributions as soon as you turn 50 as well as employer matching benefits. You will also want to make sure that you max out contributions too. Finally, whether you are looking to save more in anticipation of a possible early retirement or are on the cusp of making such a decision, you should speak with a certified financial planner.

Will You Have a Traditional Retirement?

The traditional view of retirement is that of someone in their 60s (or 70s) leaving his/her job for good. They ride off into the sunset as retirees where they spend their time with laughing and enjoying time with family and friends. In this day and age, that picturesque retirement is no more. Only about a third of American workers are currently retiring the traditional way–and staying retired. Instead, it’s becoming quite common for Americans to retire and eventually make their way back into the workforce. There may be various reasons for the return; for some it’s to overcome boredom while others may need the income a job provides. What does this mean for you? Well, for starters, you may want to take the time now, before you retire, to really visualize what retirement will be like and to define what it means to you. Do you see yourself becoming bored without the challenges a job may bring about? Do you foresee financial issues that may require you to continue working? Is your job an important part of your social life? Taking time to decide whether a traditional retirement is right for you is an important step. If you don’t see yourself enjoying that form of retirement, then what do you picture your retirement to be? You may want to start angling yourself towards that. If there is a particular place you want to live, then consider starting to make plans for getting there. If you want to keep working, make sure that is clear with your employer. There’s nothing wrong with taking a non-traditional approach to retirement so long as it’s thoughtfully done. If you need help with planning for a non-traditional retirement and making sure that your finances are in shape for that, you should speak with a certified financial planner. With that, will you lead a traditional retirement?

Changing Jobs? Don’t Forget About Your Retirement Money

There’s a good chance that you either have or will change jobs multiple times throughout your career. Those job changes may be in the form of promotions within a corporation or jumping to a new company to take a higher position with increased pay and responsibility. Your job change may even involve a career change! However the inevitable job change occurs, don’t forget about your retirement funds and savings when you do so. With many employers offering retirement benefits–and with potential legislation allowing for more smaller companies to offer them in the future–chances are you have (or had) an employer plan; most likely a 401(k). You will need to think about what you want to do with such plans when you leave an employer. Will you want to roll it over into another plan? Can you maintain that plan even though you no longer work for that employer and does doing so make sense? What are the costs and fees associated with taking the money and running? These are all important questions that you may need to answer and consider. You will also want to make sure that you understand any deadlines or limitations involved with whatever you decide. You don’t want to miss a deadline–or worse, forget about the account altogether (yes, this does happen). You also want to make sure that any moves you make with that retirement money is done as efficiently and in as cost-effective a manner as possible. You would be wise to discuss any such moves with a financial planner before making them so as to make sure you are making the decision that’s right for you.

Have You Set a Retirement Date Yet?

How much thought have you put into when exactly you want to retire? Sure, if you’re still young, you probably haven’t put much thought into when you will enter retirement aside from possibly thinking about what age you want to work until or how much money you need to have set aside before you can even think about calling it quits. However, if you are in your 50s of 60s–or feel that you have enough saved for retirement regardless of your age–you may want to start considering when exactly you want to retire. You may have a certain career milestone you hit (a work anniversary, perhaps) or maybe you have a certain project you want to see through at work (i.e. a long-term strategy you need to implement or a restructuring you need to guide the company through). You may also need to consider other factors such as your significant other’s retirement plans or whether you have particular plans for retirement that may require some preparation before you can start them (i.e. moving to another state/country or starting a second career). While it’s not vital that you set a specific retirement date–such details can be nailed down in the months leading up to it–it is important that you really think long and hard about when you will be ready to retire and what will signify to you that it is time to hang it up career-wise.