Remember when you were younger and 55 was the golden age of retirement, when folks got to take that job and shove it, and enjoy years of living their lives without having to punch a clock? Well now, that retirement age has crept into the 60s, 70s and beyond.
In my last blog post I talked about me being in the age I termed as “pre-senior.” Not quite recognized as a senior (65+) and not retired, so missing out on a lot of senior perks. As I considered my situation, I did some research and learned that seniors these days are working longer. Among Americans 65 and older, 19 percent were still working last year, which is almost a twofold increase from the late 1980s.
Money worries are one reason seniors are working longer
One of the reasons that people delay retirement is a concern about having enough money to retire. Gone are the days of company-sponsored pensions and collecting full social security at 65, so many seniors are now more dependent on money they’ve saved for retirement in a 401(k), IRA or other savings account. And although it’s great that people are living longer than they were 20 years ago, it comes along with concern that they may outlive their savings. A recent article in USA today showed that many Americans are worried that they haven’t saved enough for retirement and that’s one reason why they’re working longer.
Don’t let money hold you back from retirement
Don’t get caught without saving for your future. When you’re young you often think that you don’t have enough money to save for retirement – too many current financial needs on your plate to think about the future. But take it from me – time flies even when you’re not saving.
As they say, hindsight is 20/20, and if I had known better, I would have prioritized saving for retirement more than I did. If I knew then what I know now, I would consistently follow these tips:
- Save as much as possible in my employer’s 401(k) retirement program
- Take advantage of any matching funds from the employer and set my account to automatically save 1% more each year
- Forget the money is there, just let it build and use the power of compound interest
- Also open a Roth IRA to save money that will be tax free later
- Start saving early and keep saving, no matter what
Slowly easing into retirement is an option
Some seniors who are working longer are choosing to slowly transition into retirement. They may cut back on hours or decide to take on lesser responsibilities at work. This approach provides benefits of continuing to have an income while also getting comfortable with living off less than they’re used to making when working full-time. It also allows time to focus more on hobbies or transition into other money-making opportunities. I think that’s a great way to approach retirement. Trying it on for size.
Are you still working after 60? If so, share your reasons with us.