The COVID-19 crisis has caused a lot of people to rethink their retirement plans. Specifically, a lot of people are now talking about postponing that milestone and extending their careers. If you were hoping to retire at some point in 2020, you, too, may be considering a change of plans. And here are a few good reasons to delay your permanent exit from the workforce.
1. Your plans are upended anyway
It's common to have specific plans for retirement, whether they involve travel, spending time with family, or starting a business. But if those plans aren't feasible in the near future due to the pandemic, then you might as well work a bit longer and pad your savings.
Image source: Getty Images.
Imagine your goal is to kick off retirement by traveling across the country, or across the world. Right now, that's hardly the safest thing to do, so if your choice is to retire and be bored and restless at home or keep working, then you might as well stay at your job.
Similarly, if you thought you'd move closer to your grandchildren in retirement, spending time with them may not be all that safe or feasible if they'll be in school and you're trying to protect yourself from COVID-19 exposure. Once again, you might as well keep working.
Finally, if your goal is to start a business in retirement, that may not be feasible due to current economic conditions. A lot of existing businesses are struggling right now to keep the doors open, and waiting a year to launch yours could spell the difference between failure and success. Rather than struggle to find something meaningful to do with your time, you could instead keep working at your current job and improve your long-term financial picture.
2. You took out a chunk of your savings
If you took a retirement plan withdrawal during the pandemic to pay for immediate expenses, delaying retirement is a good way to make up for it. A lot of people had to tap their IRAs and 401(k)s earlier in the year, but remember, there's a reason you saved that money in the first place. And working longer could allow you to make your savings whole.
3. You want a proper workplace sendoff
Many people have spent the past five months working from home. If you love your job and colleagues, then you may not want to retire this year, because chances are, in doing so, you won't get a chance to experience office life again. On the other hand, if you push yourself to work a bit longer, you may get an opportunity to return to the office and enjoy a few more months of collaboration and camaraderie before calling it quits.
Postponing retirement is a tough decision, but if you were planning to end your career this year, it could make sense to delay your workforce exit rather than move forward. Instead of bemoaning that fact, think about what you have to gain (hint: more money) by plugging away a bit longer than anticipated.
