Early vs. Delayed: The Right Retirement Plan For You

Retirement isn’t as easy as most would think. Quitting your job and tossing in the towel is only a part of the big idea. Almost everyone dreams of a stress-free retirement, but it’s important to remember that this goal requires careful planning and consideration. 

Early retirement, on the surface, sounds like the ideal scenario. However, reality can be different from your fantasy. Focus more on when you should retire instead of about what age you want to quit.

Your retirement savings, physical and mental well-being, and social relationships are fundamental factors you’ll want to consider before leaving your career. 

It may initially sound like a lot, but setting aside time to give proper thought and consideration to a life-changing decision, such as retirement, is essential to provide you with the most benefits without further stress. 

Why Age Matters

Not everyone can afford the choice of picking what age to retire. 

Unstable global economies due to the COVID-19 pandemic can also impact your retirement plans: Unforeseen circumstances relating to your employment, such as job loss, health conditions, and familial responsibilities, are challenges you also need to consider. 

Suppose you’re lucky enough to have control over the matter. In that case, it’s worth considering the costs and benefits of retiring at a certain age. 

Early Or Delayed Retirement: Which One Is For You? 

Remember that your retirement decisions are ultimately up to what you believe is best for you. While there is no right or wrong answer, consider these factors before making the final decision on what age makes the most sense to retire with your current situation: 

Think about mental health 

As most can imagine, retiring between the ages of 66 to 70 can have adverse effects on your mental health. Burnout from years of hard work can be possible if you haven’t been getting enough rest.

It can also be easy to be envious of your peers who decided to leave their jobs early while you’re scrolling through their vacation photos on social media during your break at work. 

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This is not to say that working past your years can only lead to exhaustion. Studies show that older individuals who work for the enjoyment and the social benefits of their job, instead of solely for financial reasons, have found a more positive quality of life. 

If you believe your career gives significant job satisfaction and less stress, consider delaying your retirement. Retirees also experience declining mental health due to financial stress, loss of structure to daily life, and loss of purpose and meaning.

Look into retirement benefits

There’s no denying that the years added to your age can directly impact your health. Stress and physical labor can significantly affect your well-being if you don’t address them early and adequately. 

It’s easy to imagine the positive effects of early retirement on your body when you won’t have to settle for instant noodles and liters of coffee to survive a workday. However, studies show that most early retirees felt forced to do so because of illnesses – even if they couldn’t afford to retire at that time. 

Maintaining your physical health can cost an arm and a leg. Medical expenses can significantly dent your savings if you still need to implement the proper measures. 

If you plan to retire early, you’ll want to consider getting medical insurance. It can cost more out-of-pocket expenses, but most government-provided health insurances are eligible for retirees aged 65 and older. 

Hope for the best but expect the worst

Chances are, the earlier you retire, the more savings you need. Spending more than you’ve anticipated is always a possibility. 

With the current global life expectancy at 73 years, someone who decided to retire at the age of 60 will have to make their savings last for 12.98 years, compared to the 7.98 years of financial flexibility for someone who retired at 65. 

Keep in mind that expenses don’t retire when you do. Aside from saving money for travel and shopping, your retirement spending plans should also include household expenses and emergency funds. This ensures you won’t stress out about finding extra income to support your needs after retirement. 

Outliving your assets

One of the most desired elements of a comfortable retirement is the freedom it provides- especially financially. Years of blood, sweat, and tears shed at work will all be worth it once you reap its rewards. 

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If you decide to retire at age 65 or earlier, you may lose out on the interests that can bulk up the money you set aside. Benefits you can claim from Social Security can also reduce to about 75% of the total amount. 

Retiring late can lessen the possibility of exhausting all of your savings in a short amount of time.

Although delayed retirement means more time at your desk, it guarantees you more savings and benefits you can enjoy after work hours. You’ll have the chance to get the biggest possible payout from Social Security. 

The Perfect Retirement

Whether you plan to have an early or delayed retirement, lay out the blueprint of what you want to do, what you need to do, and what keeps you from doing them. Doing this practice can give you more insight into your retirement plans. 

Prepare a plan B for your plan A and a plan C for your plan B. There is always time. Retirement preparation can be exhaustive and intimidating, but hard work pays off like most things in life.  

The next time you’re planning your retirement in the middle of traffic, after spending most of the day sitting in front of piles of work in your cubicle, remember to consider everything

It’s also important to take extra measures if life throws something unexpected your way. Keep your retirement plans robust and aligned with your life goals but flexible enough to adjust should it be necessary. Put yourself at the forefront of your retirement plans. 

Spare no effort, nor expense, to finally have your well-earned rest. Take that extra step to ensure your dreams of tomorrow- your future self will thank you. 

Johnny Thompson

Johnny Thompson is a senior reporter for Generator Research in Los Angeles, reporting on technology, business, finances, and more. He previously worked as a reporter for the Wall Street Journal and got his start at newspapers in New York, Connecticut, and Massachusetts.

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