I recently came across an interesting Federal Reserve report called ‘The Economic Well-Being Of US Households’. It’s a 50+ page annual study that explores all aspects of Americans’ financial well-being. The good news is that on almost all measures and for almost all groups of Americans, they are on a better financial footing than almost ever.
In the retirement section, I was struck by a table that showed the ‘Reasons For Retirement’ that they had collected through survey data. They had the results split by age groups, so you could look at ‘Early Retirees’ – those retired at age 61 or younger, and those retired later. I was surprised at how high ‘Health’ and ‘Job Related’ was for this group:
- 55% – Wanted To Do Other Things
- 51% – Wanted To Spend Time With Family
- 40% – Poor Health
- 32% – Family Responsibilities
- 30% – Didn’t Like The Work
- 21% – Forced To Retire / Laid Off
The reasons given are not exclusive to each other. People could retire early for a number of reasons at the same time. Still, ‘Poor Health’ and ‘Laid Off’ represent a huge percent of early retirees. I would guesstimate that they represents close to HALF of early retirees – especially given that some respondents may not want to acknowledge negative circumstances in a survey. (AnUrban Institute study suggested that the number of folks ‘forced’ into retirement rose from 33% in 1998 to 55% in 2014)
I had a few colleagues at MegaCorp that had parents that had suffered in a ‘forced’ retirement and were aggressively pursuing FIRE (financial independence & retiring early) for themselves. Looking at these numbers, it would seem that everyone should expect that these are very real considerations and should be planned / saved for. Clearly, not everyone can plan on reaching the ‘standard’ age 65 retirement.
Are you surprised by how many people are ‘forced’ into retirement?
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2 thoughts on “Forced Into Early Retirement?”
Doesn’t surprise me at all. My dad was forced out after over 40 years at the same company. He was going to retire in another 5 years but was disappointed he didn’t leave on his terms after a lifetime of loyalty.
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A lot of people end up in that situation. My Dad was with his company for 34 years and was lucky enough to walk out on his 60th birthday. He’s 86 years old now and us two retirees went to a Thursday afternoon baseball game today.
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