WICHITA, Kan. (KSNW) — Fewer Americans are planning to work into their late 60s, and many are looking at early retirement.
The New York Fed’s Labor Market Survey says more people plan to leave their careers by the time they’re 62, and it’s the highest percentage they’ve recorded, at 50.1%. The survey has been around since 2014.
As for here in Kansas, Ad Astra Financial Planner Karen Reimer said COVID-19 has changed the game when it comes to work and retirement. It doesn’t look the exact same as those national numbers.
Reimer said there’s an emphasis on people reevaluating their careers. Those looking towards retirement are feeling nervous about COVID-19.
She said it’s creating two trends. There are some who readjust their budgets to be able to retire sooner, but a majority are switching careers. It’s so they can try and find the best way to live out the rest of their lives.
“This crisis, I think compelled everyone to sit back and say hey, wait a minute, what am I doing? Let me take a deep breath, let’s reevaluate, let’s realign, what’s important and what, how am I spending my time? How am I spending my hard-earned dollars?” said Reimer.
Reimer said if you retire by 62, you may want to think again. Most people can live more than 40 years after that, so it can make the budget tight.
She said if you stick it out for a couple of years more, each year your Social Security income increases by almost 8%, which can add a lot to your budget.
If you can’t wait, retirement may look different than what you dreamt of.
“You may not be able to take as many trips, you may not be able to buy as many fun things, you may have to adjust your expectations to match the reality of what a limited or more limited income is going to look like,” said Reimer.
Her advice for those that still have time to plan is to save early, spend less, and be smart about their investments.