retirement planning

When it comes to retirement, like many things in life, timing is everything.

Across America, many Boomers are wrestling with the question of when to leave the working world behind. Retire too early and you risk outliving your nest egg; wait too long and you may never get to enjoy retirement at all. It’s a complicated decision, to say the least, and one that is causing many would-be retirees to choose inaction – they simply continue to work without tackling the difficult decision of when to stop. Below are four common reasons workers put off making the decision of when to retire.

Fear of Not Having Enough

The sad truth is, many workers aren’t retiring because they are paralyzed by the fear of not having enough money for their monthly expenses. Unfortunately, many of them may be right. Recent data shows that 64 percent of Americans aren’t saving enough for retirement. Many Baby Boomers have spent years planning to rely on whatever they’ll get from Social Security, only to wake up as they near retirement age and realize they should have been supplementing their monthly retirement income with cash savings and smart investments, too.

If you find yourself contending with this fear, the best thing you can do is to take a good, honest look at your finances. It’s possible you’re better off than you think! If you still have work to do, decide on a goal retirement age and learn what it will take for you to accomplish it. For instance, let’s say you’re 62 and hope to retire at 70. Determine how much of your paycheck you need to save each month in order to achieve that goal, and make it happen. It could mean trading in your expensive leased car for a more modest vehicle, downsizing your home to save on your monthly mortgage or discontinuing some or all of the financial help you might be providing to your grown children.

When you confront your fear of not having enough retirement savings, you allow yourself the opportunity to come up with a proper plan. Even though this process can be difficult and even overwhelming, it’s preferable to being chained to your desk until your health deteriorates.

Concern Over Drawing Instead of Contributing

When you’ve spent all your adult life carefully saving and financially preparing for retirement, the idea of stopping cold turkey – and doing the exact opposite – can cause a serious pit in your stomach. Many people, even those with very healthy nest eggs, just can’t wrap their minds around the idea of deconstructing all their hard work in order to start drawing on their assets rather than making contributions. Indeed, financial preparation is just one aspect of retirement planning. It’s important to mentally prepare yourself for the transition, too.

If you find yourself struggling to change your money mindset, consider taking baby steps. Phasing into retirement by working fewer hours or handling fewer clients can allow you time to warm up to the idea of a full retirement. This also gives you more time to develop a fiscally sound plan for drawing on your retirement savings to fund your expenses. Don’t let your fear of change prevent you from ever getting the chance to enjoy the retirement you’ve worked so hard to make possible.

Supporting Family

More and more would-be retirees are staying in the workforce because they feel a responsibility to support family members. Maybe you have a grown son or daughter who can’t afford their own mortgage payment yet due to student loans, or you’re hoping to send your six grandchildren to college. Whatever the case may be, are you using it as an excuse for not planning your own future?

It’s admirable to offer financial assistance to those you love, but don’t lose sight of what you want for your own life. Allow yourself to focus on your ideal retirement, then plan for all the ways you can assist your loved ones until that time comes. You could even develop a retirement plan that allows your nest egg to work for you, as well as for the needs of your family members.

Identity or Relevancy Concerns

Have you saved like crazy, maximized retirement contributions, diversified your assets and lived prudently – yet, you still can’t fathom retiring? Sometimes, people put off retirement simply because they truly love their work. If your work defines you in large measure, and you derive meaning and joy from it, it’s normal to have concerns about losing such an important part of your identity. Many workers in this boat also worry about becoming irrelevant if they don’t have a job to go to each day, or they worry about boredom creeping in once the stimulation of daily work is gone.

If you fall into this category, it’s important to take a hard look at the kind of future you really want. Is it really your intention to work until the day you die? Or, do you foresee stepping away at some point to enjoy more time with family and friends, to travel or to cultivate hobbies? If you love your work and never intend to stop, congratulations on finding such a purposeful and rewarding career! If, however, you would like to retire at some point but are feeling held back by your fears, consider tackling them head-on. Brainstorm ways you could continue using your skill-set – maybe it’s through volunteer work or mentoring young professionals? When you plan properly, it’s more than possible to continue feeling relevant and fulfilled after leaving the working world.

Final Thoughts

Deciding to retire can be very unsettling, and the decision is a truly personal one. It often requires looking at every aspect of your life under a microscope and making tough choices. However, remember that inaction is not a retirement plan. Do the hard work now so that, one day, you can walk away from the working world on your own terms, with your health intact and your dream retirement ahead of you.