Retirement Meditation #51: What’s your intended retirement age?
By: Paul Carl
“Buddy” started contributing into his organization’s retirement plan as soon as he became eligible, often saving the IRS annual maximum dollar amount. Most years, his employer provided a match or discretionary contribution. Buddy aggressively invested the funds and periodically reallocated as he drew nearer to 60, his desired retirement age. He officially retired on the last day of the month after turning 60. A year later, he’s wondering if he should return to work because he didn’t think about two important matters: health insurance and boredom.
Retirement plans are designed to give employees the opportunity to save for a comfortable financial retirement in a tax-advantaged manner. Whether an individual saves pre-tax dollars that grow tax-deferred, after-tax ROTH that grows tax-free, or a combination, the individual is taking advantage of favorable tax rules and the ease of having funds set aside before the opportunity to spend those funds becomes available. The success of current retirement plans is remarkable with reported total U.S. retirement assets standing at $43.4 Trillion dollars as of March 31, 2025, as reported by the Investment Company Institute. Of that amount, $12.2 trillion was attributable to defined contribution plans such as the 401(k) plan.
Employees save for retirement to replace wage and employment income no longer earned in retirement. For some, a focus on retirement savings combined with solid investment market returns has made retiring early, prior to age 65 or age 67, a potential financial reality. Having the funds sufficient to retire is only one piece of the complex puzzle. As Buddy in our opening paragraph discovered, there are aspects to evaluate when considering early retirement.
Where will my (or my family’s) health insurance coverage come from and at what cost?
What will I do in retirement to remain relevant, active, and vibrant?
Besides healthcare, what other costs might I incur that I didn’t anticipate?
Will my family still need all our vehicles?
Will I have sufficient income to meet expenses and debt obligations?
Will I have college tuition and/or marriages to contribute towards?
How much travel and other big-ticket items will I incur?
When will I take social security? How and when should my spouse take social security?
Is there a possibility I will need to return to work and, if I do, will that be difficult?
What if my children need my financial help?
What unique aspects would you consider with early retirement?
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