Tuesday, July 21, 2009

Earlier Than You Think

Emily Brandon, at US News & World Report's Planning To Retire has a scary post about 'earlier than planned' retirements.

My goal has always been to retire on my 69th birthday. The view from here makes my plan look feasible, but, according to Brandon, almost half of workers wind up retiring earlier than they planned to. All but 10% do so involuntarily.

Job loss, age discrimination, family duties (such as caring for a spouse or one's parents) or a personal health crisis make a mockery of well-laid plans. Only 3% of potential retirees INTEND to retire in their fifties, yet 18% do so. 21% want to work into their seventies, but only 5% will still be employed when they reach their seventh decade.

I, of course, fall into the group of seniors who haven't saved enough to have the retirement they want (modest though that might be) if they retire earlier (or even "on time" at age 65), so continued employment is a must.

It gives me pause to contemplate all the things that can go wrong between now and age 69.


Florence said...

Grace, this scares me to death too. DH and I are both still working (62 & 63) and don't plan to retire until 66+. But accidents and illness in addition to the rickety economy makes it a very iffy thing. ACK!!

CindyS said...

I never thought I would be "retired" at age 51 but I suppose I am to some extent. Officially I suppose I am self employed as we do work. There are many options to supplement your income if you are creative... or hungry enough. :) Don't be too afraid of it.

Shevy said...

18% retire in their 50s? Wow, that's almost 1 out of every 5. Now, if they'd *wanted* to do that, it would be great. But these are mostly health and job loss related. Not so easy to enjoy early retirement if you're seriously ill.

Me? I don't know what will be. In Canada regular retirement is 65, but you can keep working and contributing to CPP until age 70 and then you'll get 30% more CPP than you would have at 65. Or retire early and get up to 30% less.

My problem is, I have a lot of years where I either didn't work or worked part time or worked for non-profits and didn't make much money. Even retiring at 65 is not going to give me more than about $1,000/month, including CPP, Old Age Pension and an annuity from a previous job.

If I work until I'm 70 (yuck) I'll only get 30% more on the CPP component, or about another $115/mo. Would you work an extra 5 long years in order to make $115 more per month?

And could you imagine if I retired early? I could try to live off of about $270/mo for 2 years (not going to happen, no way!) and then my annuity would kick in along with a temporary bridge payment. Finally, at 65, I could get OAP (which is about 1/2 of the total) and the bridge payment would stop.

Of course, this is all just my numbers. Hubby's total will probably be a little higher than mine so we'll have at least double those amounts.

But I'm hoping for good health and no layoffs!

mapgirl said...

Not to scare you, but my dad medically retired a week after his 67th birthday when he had a stroke.

Now, going to work with my mom is just going through the motions of work. (They run a business together.)

My mom is working her fingers to the bone until she can retire at 67. (Any minute now.)

I plan on working till I'm 70, but I also know I could be hit by a bus tomorrow too.

Did it MY way said...

Nothing like the fear of the unknown.

I had planned on retirement at age 50.

An expensive wife, and two kids changed those plans. 18 years later I am in a favorite position to do so. And not by my choice.

I just got so tired working for everybody else with poor returns left for me that I deceided to quit. August 12th will be the shop auction, and then the travel begins.

Retire as soon as you can-life is to short. You CAN live on a lot less than you think. Be creative.

See Ya

Revanche said...

Both my parents fit into that 18%, and it was due to both illness and small business failure.

I plan on working for a good long time but, just in case, I've taken out some life insurance to take care of them if anything should happen. Of course, given the other statistics, I'd better get on the disability insurance too. Does them no good to have the life insurance if I *only* get injured or sick and can't work.

Sharon said...

Just seeing how debiliated my husband was (he's 46) when he got sick at the lake was enough to scare me into thinking we really need to beef up our savings, just in case we need to stop working earlier than expected.