While 65 is seen as the traditional retirement age, many baby boomers don't expect to settle down and exit the workforce when they reach this age.
This is a key finding of data from the Transamerica Center for Retirement Studies. In fact, 65 percent of respondents said they predict they will work past 65 or not retire at all.
"They are forging a new model of retirement that is a radical departure from that of previous generations," said TCRS President Catherine Collinson. "In doing so, baby boomers are overturning long-standing assumptions about working until age 65, calling for dramatic changes in current employment practices and proving that retirement and working are not mutually exclusive."
Respondents had various reasons for expecting to work past 65. Here's a breakdown of their responses:
- Income and health care concerns (62 percent)
- Enjoyment (34 percent)
- A desire to stay involved (18 percent)
- Fulfilling work (16 percent)
Preparing for a secure financial future
While there's nothing wrong with working until your heart's content, you don't want to struggle financially once you're ready to hit retirement age. Wouldn't it be better to continue working for the final three reasons in the list rather than need?
Early preparation is always one key to a sound retirement. This includes constantly revisiting your expected needs and goals for retirement. Maybe you think you'll work until you're 70 and then explore the world. However, 10 years from now, you may decide to work until you're 67 and then settle down in Spain. Whatever the case, you must continually plan because the number for your target nest egg is fluid - especially considering inflation and unexpected events.
Health care costs are a major expense many retirees don't think about until they are faced with a major medical emergency. Without employer-sponsored insurance and steady income, you will have a harder time handling these costs and preserving your retirement savings for the rest of your life.
Working and playing on your terms
Some retirees opt for part-time work when they reach their golden years. This is an option if you want to keep doing what you love while still having time to relax.
"Few baby boomers expect to immediately stop working when they retire," Collinson said. "It is now a phased transition, which may involve shifting from full-time to part-time work, taking on a position which is more satisfying and/or less demanding or pursuing an encore career."
For more information on effective wealth management strategies, contact Landmark Bank.
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