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For some, early retirement may seem like an easy choice. Countless Americans happily step out of the office and onto the golf course the day after they turn 62. However, many others find fulfillment in their work, and happily work through their 60s avoiding the topic of retirement like the plague.
Needless to say, early retirement is a topic that has Americans divided. According to one report, nearly 50% of all Americans expect to retire early. But considering that another study found that over three quarters of retirees in America carry debt into their retirement, early retirement may be too much of a financial burden for some folks to do it comfortably. In fact, for some of the nearly 1.5 million retirees who re-entered the U.S. workforce in 2021, rising costs and issues staying afloat financially on a fixed income were the key drivers in their decisions to return to work after calling it quits.
Whatever the case may be, early retirement is still a viable - and attractive - option for Americans who have simply had enough of the everyday grind. Remember though: Whether you choose to stick it out, or leave the labor market early, the choice should always be yours. Here are five reasons to consider finally taking the plunge into early retirement.
As we age, our health declines. This can be a strong motivator to retire early, especially if you have significant health conditions that are only expected to worsen as you age. Working is already taxing, how can you keep up with work demands if you're in poor health? If you do decide to retire early due to ailing health, you're not alone. One study by the National Institute on Aging states poor health is one of the top reasons many Americans choose to retire early.
If you go this route though, it's important to ensure you have enough money set aside to help you manage your health in the future. Without your work health benefits, you'll have to have something else set up to help you cover prescription costs and potential surgeries. Enrolling in a Health Savings Account (HSA) is a good option to consider.
Stress comes with the territory of being a working professional, but it could be harming you more than you think. According to the American Psychological Association, those exposed to chronically stressful environments - like working in high-pressure environments - can experience burnout. What does burnout feel like? Exhaustion, feeling negative or cynical and being less productive at work. And if you're a teacher or health care worker, you're at an even higher risk of developing burnout.
If this sounds all too familiar, it might be time to step away. Your health, both physical and mental, is more important than any job. You might even decide to retire early from your current profession and step into a less stressful part-time job. Whatever you decide, if your job is causing more stress than you can handle, early retirement may be the right path for you.
Read more: Here's how much money the average middle-class American household makes - how do you stack up?
Many Americans who are nearing retirement may also be dealing with parents who are entering end-of-life care. Nearly 40% of those currently in the workforce are either serving as caregivers right now, or have in the past, says a survey by Transamerica Center for Retirement Studies. This could be an important factor to consider if you're on the fence about retiring early.
Caregiving responsibilities extend beyond aging parents, too. Maybe you have a spouse with complex medical needs, an ill family member or even a grandchild who needs babysitting. Whatever the case may be, supporting your family is an important job, one that could be more important than your professional one.
Why work when you don't have to? Especially if you have any of the concerns above. If you have a partner with a substantial enough income to support you both, consider leaving your job behind and starting your retirement early.
Just make sure you've reached your full age of retirement, as outlined by the Social Security Administration. That way, you'll get your maximum retirement benefits instead of the reduced amounts you'd get if you chose to retire before then. Your full retirement age could be 66 or 67 depending on the year you were born, so it's important to know this information before committing to an early retirement and potentially losing out on your full benefit amounts.
Have you ever missed out on an event, trip or important family event because of work? Or maybe felt that you were more irritated with your partner, spouse or child because of work stress? You're not alone. According to the American Institute of Stress, over 75% of American workers say job stress affects their personal relationships.
If you feel like your job has taken over your life and you're struggling to keep up with your duties as a partner or parent, it might be time to consider leaving the workforce for good. It's important to remember that you only get one shot at this life thing, so if your work-life balance scales lean 99% to the work side, it might be time to kick work off the scales entirely.
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.