HOW TO DELAY YOUR RETIREMENT AT YOUR CURRENT EMPLOYER

The most popular way people delay their retirement on their terms is by working out a flexible arrangement with their current employer. This can work for you both in that you get the reduced hours you want and your employer doesn’t lose the skills and value that you bring. Here are a few ways you can change your job to fit the life you want.

Full-Time To Part-Time

Stay where you are on a part-time basis. Your current employer may be the best place to work and the most flexible to work with. There may be some part of your job that could easily be handed off to others as you continue with the truly valuable things you do. You may be able to maintain some benefits with a negotiated compensation arrangement but you will need to be flexible.

Phased Retirement

There are many types of phased retirements. They all are centered on helping the employee gradually leave the company while giving the company time to find a replacement. The one I see the most is where you work out a timeline, say 2 years where you reduce the hours you put in in stages until full retirement.

Job-Sharing

If there are others you work with that do the same thing as you, job-sharing is an excellent option. You and your job-sharing partner share and use the same work space and tools (computer) and do the job as one full-time person. This will require close coordination and trust between both employees and with your employer.

Freelance / Consulting Work

If you want total control of your time and work, and you provide a valuable service to the company, being a consultant or freelance contractor could be your best option. You work on a project by project basis depending on the need. Over the last 4 years, I’ve averaged 6-7 months of work, some of it full-time and some of it, a couple days a week. This gave us the freedom to travel and launch this blog.

Important Notice: When considering the various options, review them with your financial advisor and tax person (both of which I am not). There are limits to how much you can earn if you’ve claimed Social Security and there also may be tax implications to consider with Social Security and other sources of retirement income.

From The Employer’s Perspective. 

When discussing retirement, the topic tends to be from the retiree’s point of view. Rarely is the conversation about how the retirement of a key employee will affect them and the business they are leaving. 

The number of retiring baby boomers out numbers the amount of younger workers coming in to replace them. This is causing a shortage of qualified workers. It is also creating a brain drain where the valuable knowledge and experience is leaving with the retirees. 

Being flexible with retirement age people can prevent disruptions to critical operations. It will also reduce the expenses involved in hiring and training new people. 

Having the old pros around to help with on-boarding new hires could be a great benefit. Employers will also be able to use these people to mentor younger people in advance of the retiree leaving their jobs. 

75% of companies polled in a recent survey said they would allow older worked to reduce their hours instead of losing them to full retirement.

In my next post I’ll get into how you can be proactive and take control as you approach Your Extra Inning. Please leave a question or comment. https://yourextrainnings.com/contact/

7 NOT-SO-GOOD REASONS WHY PEOPLE HAVE TO DELAY THEIR RETIREMENT

YOUR EXTRA INNINGS

Continuing on from last week’s post (see below), there are good reasons to delay retirement and some not-so-good reasons. There are many people in the world who simply can’t afford to retire. So here are the more common Not-So-Good reasons to delay your retirement.

1. Not Enough Retirement Savings.

Today, almost 60% of Americans have little or no retirement savings. There are many causes such as underfunded pensions, not putting enough into their retirement accounts, or they take money out early. The reality is, according to the Federal Reserve, of people over the age of 55, the median retirement savings is only $120,000. That’s not going to work, and Social Security is not going to be the solution.

2. Divorce.

20 years ago, 10% of people over 55 got a divorce. Today that number is 25% and now qualifies for its own category: Grey Divorce. If you are divorced you probably had to split all of your assets including retirement savings and the value of pensions ect. What remains may not be enough to fund the retirement of two households.

3. Little or no equity in your house.

Only 30% of baby boomers feel like they have fully recovered from the great recession. Starting in 2008, property values plunged and many people had less equity in their homes than they owed on their mortgages. While they have recovered for the most part, if you refinanced 10-15 years ago and sunk the money into home improvements, you may now be breaking even. The big contribution to your retirement nest egg you thought was coming from your house is not happening soon.

4. Medical issues.

You or your spouse may have had a debilitating illness or event that made it no longer possible to work. One of you has to still work to make ends meet and maintain health insurance coverage. Your two paychecks, two contributions to retirement savings and Social Security are now down to one.

5. Taking care of a parent.

The cost of assisted living or retirement homes can break the bank. If a parent didn’t have sufficient savings or it was depleted due to medical reasons, you may have no choice but to take them in. You or your spouse may have had to leave their job to provide the necessary care. According to a recent Forbes magazine article, as a result of the costs of being a caregiver, they are on average saving 30% less for retirement than those who are not caregivers.

6. Healthcare Costs.

Cost of healthcare is a big retirement risk. I’ve seen estimates that put medical expenses a couple will see after turning 65 at over $200,000. Thanks to the brain trust in Washington, it hard to be confident that there will be any help soon.

7. Family Support Issues.

Remember those kids you thought left the nest? Welcome to the world of Boomerang Kids. The nest has filled back up with your kids, a significant other and possibly a grandkid or two. We are always parents and when the kids need help, we’ll be there. But at what cost to your retirement?

These are just the most common reasons for having to delay your retirement. This is a reality for many people. Understand that if you are one of these, you are not alone. What’s important is to accept your situation. If you are expecting to delay your retirement for any reason, be proactive and take control of Your Extra Innings. Be creative and design your retirement years on your terms.

In my next post I will get into some of the ways people are doing just that. If you have anything to add or have a question, please leave a comment. Also, if you want to have future articles emailed directly to you, leave me you email address below. Your email address will not be shared with anyone.

6 GOOD REASONS WHY PEOPLE WANT TO DELAY THEIR RETIREMENT

When I tell people about Your Extra Innings, I often hear “Why the heck would I want to delay my retirement?” But, in a recent survey, 2/3 of Baby Boomers are planning to work or are working past 65. There are many reasons to consider working beyond the “normal” retirement age. Some are good and positive reasons and some aren’t so good and positive. Here are a few of the good ones:

1. Our health is good.

We are taking better care of ourselves, for the most part. Resources are everywhere on how to maintain your health, get fit, lose weight. Far fewer people smoke these days. And medical advances are making once fatal diseases curable and debilitating conditions manageable.

2. Therefore, we’re living longer.

In the past century, life expectancies have risen by almost 30 years. No longer does retirement mean at 65 you get a new recliner and a funeral at 70. The years after 65 can now amount to a third of your life span and you need to finance this “Longevity Bonus”. It makes sense to keep padding the retirement funds while you still able and willing to work. Furthermore, what are you going to do with all those added years?

3. Delaying Social Security.

As it works right now, if you delay taking Social Security benefits past your full retirement age, the amount you qualify for increases every year by around 8%. There are still many factors to consider when deciding when to file for Social Security and you should make that decision with a financial advisor, which I’m not. But 8% a year is a pretty good investment.

4. You like what you do.

You’re good at what you do and you like having a purpose. Almost 50% of pre-retirees who plan on some type of work in retirement say it’s for stimulation and satisfaction. I remember a news story a few years ago about a toll collector on one of our highways. He loved his job. He saw his mission was to bring a bit of sunshine to the drivers during their brief interaction. He greeted each one with a smile and a big hello and worked until his 70’s. There are nurses that love to nurse, teachers that love to teach, and me I love to be part of big construction projects.

5. Social Interaction.

You like the people you work with and the socialization you get from working with them. Whether it’s swapping the latest Game of Thrones theory or working through the terrible call during last night’s game, it can be hard to replace that interaction when you’re retired. Being part of a team makes you feel good. This is the number one thing retirees miss about working.

6. Mental Stimulation.

You want the mental simulation you get from working. Staying active and engaged helps keep your brain healthy. People who retire and are not engaged have been found to lose mental capacity faster than those who are working. So why not keep thing active and healthy between the ears.

Do any of these hit home? Please share your thoughts and comments. In my next post I’ll go over some of the common not-as-good reasons people may have to delay their retirements. If you sign up to be on my email list you’ll receive the next post in your in box.