5 Reasons Why Retirement Might Come Earlier than Planned

For many of us, retirement can feel further away than it actually is. Whether we are starting a career, in the middle of our most productive years or approaching the end of our working years, retirement is a transition that should be strategized from a number of different perspectives. The purpose of this article is to examine different scenarios that might lead to an unexpected change in plans — maybe a year or two early, or perhaps much earlier than one might have anticipated. Some of the circumstances are good and some are difficult, but all of them amount to an important decision one must make in terms of their career and finances.

Your Health

Although people work with ongoing medical conditions all the time, not everyone is the same. There may come a point where a body simply cannot handle the same activity every day. This is not limited to physical health either. As more people attend to their mental wellness, some may discover that their jobs are an obstacle to feeling at ease. Whatever the health factor may be, it is possible to transition into early retirement over a period of time rather than leaving work immediately — for example, working from home rather than commuting every day. Transitioning may make things easier and allow for continued savings rather than an abrupt cut off of your working income, facilitating a more comfortable retirement when it is time to finally retire fully.¹

Family Obligations

It may not be our own health that is a factor in early retirement. Taking care of a parent, child, spouse or other family member who needs your attention can be a reason. Although care professionals may be a big part of meeting our family member’s needs, it is likely that we will want to be a bigger presence in their daily life. Here, too, transitioning to working from home might be a financial stopgap to help enhance an eventual full retirement.²

A Sudden Windfall

Not all of the circumstances that might lead to early retirement are negative. We might enjoy a sudden windfall in terms of investments, inheritance or some other unexpected financial benefit. The side-effect to this windfall is that it might make the daily grind a little less desirable. Perhaps even totally unnecessary. Something to think about before we retire to enjoy a new lifestyle -- we may find life without work a little too idle for our taste. If this isn’t a case where we’re transitioning to working fewer hours before full retirement, we might want to consider a new pursuit for our newly-discovered free time.

Moving On

Of course, there are many transitional situations where the decision is more or less out of our hands. If the company a person is working for is going through some sort of change, such as an acquisition, it may be in their interest to make some staffing decisions. Other situations may be something like a financial crunch for the company, where they can no longer afford to pay all the employees. Although one might find that they need to seek other employment, it is possible that this dovetails with the “windfall scenario,” where the company parts ways with via a “golden parachute.” In some situations, this parting gift may be a financial bridge to early retirement.³

A New Opportunity

It is also just as possible that your career is a means to an end to build a new opportunity. Maybe it is to start a small business, such as a coffee shop or a bed and breakfast. Maybe it is to create a charitable organization, one that allows you to focus your energies on matters that are meaningful to you. Whatever opportunity one might have in mind for a way to use their retirement years to satisfy themself, a new opportunity with built-in income may be a path worth contemplating.

Whatever your path to early retirement, it is always a good idea to run these scenarios past a trusted financial professional. They can assist in easing the transition and adjusting a financial strategy accordingly. For the original article, click https://silverman-associates.com/blog/5-reasons-why-you-might-retire-earlier-than-you-planned. Follow us on Facebook.

This content is developed from sources believed to be providing accurate information, and provided by Twenty Over Ten. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.