Updated on 06.07.11

The Truth About Retiring at 65

Trent Hamm

In 1935, when the Social Security Act was passed by Congress and signed by President Roosevelt, the new law established a national retirement age of 65. At that age, people could begin receiving Social Security benefits and, in the minds of generations of Americans since, effectively set the psychological “retirement” age.

There’s an important fact to consider, though, that’s been left out of this story. In 1935, the average American lifespan was 61.7 years. You had to exceed the average American lifespan by more than three years to begin receiving Social Security benefits.

Let’s roll forward to today. The “retirement age” set by Social Security is still 65. However, today the average American lifespan is 78 years and continuing to rise.

In other words, the national “retirement age” of 65 has remained unchanged for 75 years, but the lifespan of the average American has gone up by 16 years.

Yes, this is an easy explanation for why Social Security is seeing financial problems, but there’s a more vital issue at work here, one that we’re seeing at work all over the place in America.

40 is the new 20. 60 is the new 40. Simply put, people are living far longer and enjoying excellent health much later in life than ever before.

In 1935, a person aged 65 was often quite elderly and in poor health. In 2011, a person aged 65 is often full of vitality and has two more decades of lively activity ahead of them (at least).

There are two key points to pull out of this.

First, if you’re under 50 or so, you’re probably not going to be able to retire when you’re 65. In the past, Social Security could sustain you by providing enough income between the age of 65 and the end of your life that you could survive. Unfortunately, as lives grow longer and future generations grow smaller in size, one of two things will eventually have to happen: either the Social Security age will move back or the amount of benefits will fall.

That means that either you’re going to be going on full Social Security benefits at a later age than 65 or Social Security benefits are not going to be enough to sustain you in retirement at all. In either case, retirement at 65 simply because Social Security is now available is quickly becoming a myth – and will completely become a myth in a decade or two.

At the same time, however, 65 is the new 45. Over the last 75 years, the quality of life for people over the age of 65 has increased drastically. Rather than beginning to lose control of their faculties, most people between the ages of 65 and, say, 80 are quite valuable and have a ton to offer in the workplace and in the marketplace.

Simply put, at the same time that retiring at age 65 is becoming less feasible because of longer lifespans and demographic shifts, it’s becoming much more worthwhile to continue being productive at 65.

What does this mean for retirement planning?

At this point, I don’t view retirement planning as saving for true retirement. Most retirement savings plans allow you to begin taking money out at age 60, which means you likely have a quarter of a century of good health ahead of you at that point.

Instead, I look at retirement planning as building a backbone for a second career. At age 65, I won’t have enough retirement savings or Social Security income to fully sustain me for the rest of my life, but I will have enough retirement income to make it possible to take some significant career risks. I can take a low-paying position with a charity or even do volunteer positions with some perks. I could retreat for a year and write the novel I’ve always wanted to write. I can take a very low-stress job as a greeter or a position on a community board that gives a stipend.

These are all things that are difficult to do right now in my life, yet sound appealing to me and have a firm place on my to-do list.

Simply put, my retirement savings aren’t just for retirement; instead, they create possibilities for a second career or other opportunities later on during my healthy adult life.

Don’t fear the changes coming in retirement savings. Embrace them for the opportunity that they are.

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  1. Carmen says:

    Holy cow! I’m well, well, well under 50 and absolutely intend to take a proper full retirement by 65 at the very latest. I’ll be half dead by then ;-)

    People are living longer and today’s 65 year olds are generally fit and healthy, but I think the current generation of under 40’s might reverse these statistics with the huge obesity problem we have going on. Today’s families quite simply don’t have anything like healthy eating or exercise habits to keep the current statistics going.

  2. almost there says:

    People living many years past 65 is not an explaination of why OASDI(Old Age, Survivors, and Disability Insurance)or what we call Social Security is in trouble. Wiki OASDI and get informed on how it has changed over the years with the federal goverrnment expanding the people able to draw on it as well as the increased taxes to pay into it. The reason it is in trouble is that the government did not invest the surplus every in non US Govt. obligations but spent it. Had we purchased notes in foreign central banks like the Bank of England we would be Trillions of dollars in the black and able to use the money to promote all social programs for our citizens be it health care or education, etc. Perhaps even doing away with the OASDI taxes and making do off the returns on the investment.

  3. George says:

    Basic facts are wrong: full Social Security retirement age is now 67 (but you can begin taking lesser payments at age 62).

  4. Jon says:

    How can you continue to get the basic facts wrong again and again. The full retirement age has changed many times and is now 67 for those born in 1960 or later. Also the growth in lifespan is leveling off and may decline because of health issues we cause ourselves to suffer. Please spend just a little time and effort to get your facts straight before you use them to support your views.

  5. valleycat1 says:

    You don’t mention that the age for receiving full SS benefits is now from 65-67 depending on your birth year – the age is 67 for those born 1960 or later. Eligibility for reduced benefits begins at 62.

    Certain retirement vehicles require that you start taking distributions as early as 59.5. Of course, there’s no one saying you can’t then reinvest or save it instead of spending it if you don’t really need the cash at that point.

  6. Johanna says:

    Life expectancy at birth is a highly misleading statistic to use here. A huge part of the increase in life expectancy has been the decline in infant and child mortality – and infants and children don’t pay into the Social Security system. Somebody who dies at age 1, and neither pays any Social Security taxes nor collects any benefits, has no effect on the stability of the system for the rest of us.

    If you look at the life expectancy at age 20 – closer to the age at which people start working – that’s also increased over the last 75 years, but by a smaller amount. Because, as you say, older Americans on average are enjoying longer and healthier lives. But you know who’s enjoying the longest and healthiest lives? Affluent people. The ones who need their Social Security benefits least.

    So, “just cut Social Security and raise the retirement age” may work just fine for me, or for Trent, or for many of the other people reading this blog, but for the people who are out there doing the tough, physical jobs, who can’t afford good health insurance while they’re working and who can’t afford to save adequately for retirement on their own, it works much less well.

    But don’t worry, I’m sure all we need is for both sides to sit down and come to a compromise, and it will all be all right (eyeroll).

  7. MissPrism says:

    Is that life expectancy at birth? If so, it’s an almost completely irrelevant figure as it includes childhood and infant mortality. Life expectancy for people already of working age has gone up over this time but far, far less dramatically (and mostly for those of higher economic status).

  8. Joanna says:

    Confused by the life expectancy at birth & age 20 argument. If you follow Trent’s link then go to the page where it shows life expectancy at age 20 in every case (white & non-white males & females) the life expectancy has increased for folks age 20 as compared to their birth life expectancy. The figure listed is the # of years of life they have left thus it’s a year (or so) higher than it was when they were born. Worldlifeexpectancy.com (for whatever that’s worth) shows U.S. life expectancy at 78.1 at birth and 83.7 at age 20. So Trent’s argument is even more strongly supported, no?

    I also would love to see some evidence for the diferences between affluent and non-affluent life spans. It makes logical sense that the more affluent would live longer based on lifestyles & access to health care but can you point me to the stats/studies that have proven that out? Thanks in advance.

  9. Paul says:

    I’ve decided that I’m retiring no later than when I turn 64 years old (It’s a nice round number, and even going by the 65 concept, it’s retiring early). I’m saving early and in quantity, and if I have to do with a little less after I retire, so be it. I disagree with your analysis on two points:

    1. Even if your physical and mental health is better, 65 is still OLD, and 70 is definitely so. There’s a stigma to doing the fun things one does after an early retirement when your hair is gray and your skin is wrinkled. You can’t trawl the island bars or party all night in Vegas when you look like you should be hitting the early bird special at Old Country Buffet, at least not unless you’re quite rebellious.

    2. As regards the “second career” concept, even if you love what you do, as I do, no one loves *work*. We don’t like having to get there on time, having to answer the phone even if you’re in the middle of something, meeting quality standards. Even if you’re running your own business, you still have to be attentive to the customers instead of doing the parts of the job that are what you love. Retirement is about getting away from that, not having any boss or control over you whatsoever.

    In other words, to my view retirement was never about being unable to work, it’s about being able to work but not having to. It’s saying, “I’m healthy, able, and energetic, but all my energy goes, not to producing something for you, but consuming something for me, with money I didn’t sweat for, but simply went without while I was working.”

  10. Debbie M says:

    I thought you were already in your second career.

    My “retirement” period is going to be to not have to work for money at all. Most things I like to do are things that nobody wants to pay for (reading, hiking, eating, catching up on “Buffy,”) or are things I’d love to be free not to charge for (tutoring, blog writing).

    Also, I’m under 50 (barely) and I’m retiring at age 52.

  11. Debbie M says:

    Paul, I love meeting quality standards. Which is another good reason not to have to work at a place where there’s never enough time or resources to let you do a really good job. (All of which still supports your main point, of course.)

  12. Joanna says:

    Oooh, Debbie M. You need a blog of your own! How to retire at age 52. That sounds quite appealing. :-)

  13. jesinalbuquerque says:

    Good points, but the assumption that people will keep on working is based on the premise that there will be jobs for them. Given the current economic conditions (which I for one don’t think are going to reverse anytime soon) that may not be the case.

  14. Nick says:

    My wife’s and my plan is also to retire at 52. We are both maxing out our roth 401k’s and with the employer match and deferred compensation we are saving plenty. We also invest outside of our retirment accounts to achive this goal. We started at age 27 along this path and will have more then enough at age 52. Anything is possible if you start early.

  15. Kathryn says:

    I love this article. It reminds me of something my pastor said when he “retired”: it’s not the end of working (or ministering), just the beginning of the next thing God has for me. At age 80, he’s full of vitality and runs a ministry, writes, and travels. Seeing his example really got me thinking in a new way about what retirement might mean for me.

  16. bogart says:

    I’m going to fall back on what I recently said here: If I don’t have enough saved that I can reasonably expect to live on it forever (OK, to 100), including the time in the nursing home, I don’t think I can (should) retire. I might be able to take time out of the workforce. I might be able to cut back on my hours or change careers. But I can’t retire. I mean, sure, we can change the meaning of the word retirement if we want to, but why not instead use it as it has conventionally been used and use other words for other concepts?

    Another huge thing that has changed since 1935 is health care. On the one hand, many valuable procedures and medications are now available that didn’t used to be. On the other hand, they are expensive — and (though the recently passed law may change some aspects of this, depending) plenty of people cannot buy health insurance if they don’t have access to a group plan and can only access a group plan through full-time employment in a job with benefits. Medicare changes that, but only at 65, making early retirement difficult for many.

  17. Jennifer Wear says:

    I have to say, 65 is the new 45 only if you take care of yourself. If you are like so many people who ignored their health and are overweight and out of shape, 65 might be your death age.

  18. Des says:

    “At age 65, I won’t have enough retirement savings or Social Security income to fully sustain me for the rest of my life”

    Maybe you should be saving more then, no? This post just seems like an excuse not to contribute the proper amount to your retirement funds. What does SS have to do with retirement anyway? No one I know under 40 is counting on SS for anything – more like its will be a nice bonus if it still exists. So, given that, whether or not you have enough money to support yourself at age 65 depends entirely on what you are doing with your money now.

  19. Luke says:

    Trent, you say, “most people between the ages of 65 and, say, 80 are quite valuable and have a ton to offer in the workplace and in the marketplace.” I quite agree with you, but our culture and “the marketplace” do not. If you are over fifty and looking for work these days–well, good luck.

  20. lurker carl says:

    Social Security’s retirement age for the maximum benefit is 70. Taking the benefit earlier results in a lower monthly check, it also leaves your spouse with a lower survivor benefit when you die.

    It pays to have an excellent salary during your career in order to maximize government benefits. It also allows you to save a considerable percentage of your take home paycheck to fund retirement and self-insure your final decades. I have never heard anyone say they regret saving too much money. Plenty say they regret not saving enough.

    The most common complaint I hear from seniors is they waited too long. Think travel, enjoy family, pursue hobbies, farm their version of Green Acres, smell the roses. Windows of opportunity close without notice, hard and fast, as you age.

    Youth is wasted on the young, wisdom is wasted on the old.

  21. jim says:

    Carmen said : “… today’s 65 year olds are generally fit and healthy… I think the current generation of under 40′s might reverse these statistics with the huge obesity problem we have going on”

    Obesity rates are actually highest in the 40-59 age group and the 60+ is as obese or more obese than the under 40 group.

    From the CDC :
    Adults 40–59 years of age
    were more likely to be obese compared with younger and older individuals. Approximately 40% of men 40–59 years of age were obese compared with 28.1% of 20–39 year-olds and 32.2% of those aged 60 years and older. Among women, 41.1% of those 40–59 years of age were obese,
    whereas 30.5% of younger women 20–39 years of age were obese. No significant difference
    existed between the oldest women (60 years and older) and younger women.

  22. jim says:

    Johanna makes a good point.

    From the tables :

    life expectancy at birth
    1940 = 60.8
    2004 = 75.2

    An increase of 14.4 years.

    Life expectancy at age 20 (for men) :
    1939-1941 : 47.7
    2004 : 56.7

    An increase of just 9 years.

    So if you only look t adults the increase is less. Its still significant but not as high.

  23. todo es bien says:

    If you look at the average savings rate there is absolutely no way the average person will be able to retire at 65. There is going to be TREMENDOUS competition for the kind of jobs that retirement age people can do, especially if it has any medical benefit at all. This will make entry level jobs for young people much more competitive.
    The best hope anyone has to carve out a decent living is to differentiate themselves from what will be a teeming horde by acquiring skills and education. The competition at the bottom is going to be be very very crowded. Will not be pretty.

  24. jim says:

    Joanna : “I also would love to see some evidence for the diferences between affluent and non-affluent life spans. It makes logical sense that the more affluent would live longer based on lifestyles & access to health care but can you point me to the stats/studies that have proven that out?”

    See the CBO study : “Growing Disparities in Life Expectancy.” (you can google it, I’ll post link in next comment but links are usually filtered to moderation)

    says :

    “In 1980, life expectancy at birth was 2.8 years more for the highest socioeconomic group than for the lowest. By 2000, that gap had risen to 4.5 years. The 1.7- year increase in the gap amounts to more than half of the increase in overall average life expectancy at birth between 1980 and 2000.”

    So : higher income people live 4.5 years longer than poor people

    Smoking, obesity, self management of disease, healthy lifestyles and use of health care are all contributors to longer life that differ a lot based on socioeconomic demographics. In other words poor people don’t, or are inable to, take as good of care of themselves in general.

    Of course these are just averages based on lifestyle trends more than anything. A poor person who takes good care of themselves ought to outlive a rich person who smokes and drinks too much and neglects their diabetes.

  25. Donna says:

    One thing that everyone these days either doesn’t know or doesn’t remember is that social security was never intended to be anyone’s sole source of retirement income. It was designed to be a safety net to keep older folks from starving if they didn’t have income to cover their basic necessities.

  26. Matt says:

    “Simply put, people are living far longer and enjoying excellent health much later in life than ever before.”

    Living longer? Sometimes. Enjoying excellent health? Maybe, maybe not…

    Wonder why health care is so expensive these days? It’s because we’ve got more (expensive) fixes for more ailments, which a larger percentage of the population has than ever before.

    @#23 todo es bien – “There is going to be TREMENDOUS competition for the kind of jobs that retirement age people can do, especially if it has any medical benefit at all. This will make entry level jobs for young people much more competitive.”

    It’s already happening. The statistics on the types of jobs new grads are getting – and how many are living with their parents as a result – are startling. I only graduated 6 years ago, but it was much different even then.

  27. getagrip says:

    I tend to agree with comment #6. For people who have had mostly physical labor type of jobs, they tend to take benefits as soon as possible. There are only so many foremen/supervisor spots to get filled, and if you don’t get some of them, it’s hard to get out of bed with the aches and pains of 40 years of hard labor. Its not so easy pulling wires, hauling ladders, laying brick, etc when you’re in your sixties. Yeah, you can likely still do it, but you don’t want to be doing it 8 hours a day, not to mention doing it 12 hours to pick up the overtime you used to get. What I typically see is a lot of these guys retiring and doing side jobs via word of mouth for a half dozen years or so.

    With that said, I see a lot of people who do retire “early” getting a less stressful part-time job often related to what they were doing, more often than not with a non-profit or church they support. Of course these are also typically the same ones who don’t rely completely on Social Security in the first place for their retirement. I also see a bunch of folks who figure Social Security is their retirement, rather than as mentioned in comment 25, a supplement to keep you from being old and on the street.

  28. Annie says:

    I don’t understand the concept of retiring at “52”. Won’t you have to carry your own health insurance which is costly every month. How much money can you save and have it all go towards health insurance and god forbid if you had a medical emergency what then??? why would you want to retire in your 50’s unless your past millions, wouldn’t you be better off working and having at least the health insurance part taken care of by your employer or at least partial payments. I think retiring at the appropriate age is good for average people who don’t make millions of dollars a year. There is no way in this economy the way health insurance premiums are going up and the stock market fluctuations that we can afford to retire comfortably. If you can do it, more power to you, i am impressed with people that plan for early retirement but are you also seeing the costs associted with retiring early.

  29. Nick says:

    Our idea of retirment is no matter how much we have saved at age 52 is to figure out how much we can spend every day to last us the rest of our life and go for it. In my profession I see a ton of people who wait their whole life for “retirement” only to find out they are too sick or not able to get around like they planned and don’t fully enjoy their remaining time. Again the key to our plan is we started at age 27 to achieve this goal.

  30. Annie says:

    Thanks for the fast reply. I admire you for starting at age 27. Best of luck to you I do agree with you about folks out there not enjoying their remaining time because they are too see or poor planning.

  31. DOT says:

    Donna #25 Agreed!
    I have said before I would support not having Social Security with a fade out of younger people so it is not a dramatic change for the people who are going to be relying on it as there sole source of income.
    Some one questioned in a post a week or so ago why do we still have Social Security and I tend to agree. If I had the money that SS took from my weekly check and the amount my employer is responsible for ( approx. 11% total of my earnings) I could do a much better job of saving and investing that money to be used for my old age. That way I am in charge of when I decide to quit working. ( when I feel that I have saved enough to enjoy a lifestyle of my choosing that is financially sustainable for the rest of my life). I would not have to rely on the government ( Social Security) or an employer ( pension, 401k, etc) to tell me at what age I can have my money back and how much of a it they are going to return to me every month. I am responsible enough to provide for my finances in old age in this manner. Unfortunately there are too many people who choose to rely on someone else to provide for them or tell them what to do without thinking for or educating themselves.
    I am 46 and PLAN to retire in 6.5 years. This should be possible due to a large savings rate in regular savings accounts, CDs and real estate that I can access prior to 59.5, Roth, IRA and 401k that will kick in at 59.5. and possibly social security at 62. However, my ability to retire early is mostly due to the fact that many, many years ago I knew I did not want to work for money for the rest of my life and have saved almost 45% of my income each and every year with out fail, learned to live a very happy life without the need of many consumer goods, set goals and planned, planned and re planned.
    Annie – For health care I have planned for a HSA plan with a high deductible and have tried my hardest to stay as physically fit as possible. I have set aside an obscene amount of funds for this but really all I can do is take a leap of faith and “keep my fingers crossed”.

  32. littlepitcher says:

    As someone nearing 60, I feel confident that I can work beyond 70 if my health continues good. People tend to forget that modern medicine is subject to the same “law of information” that computer technology is, and that treatment modalities, including exercise and nutrition, are better than yesterday and improving. I feel better now than I did at 18, because of these advances.
    Plan to maintain and improve health, as your best investment. Do, though, have backup plans if identity thieves improve techniques as fast as medicine and IT have, or your clone, especially if that clone is a government worker, could be drawing your Social Social Security as well as hers/his!

  33. Debbie M says:

    Annie (and Joanna) – It’s good luck that lets me retire at 52 – I have a pension and (so far) my employer offers an affordable retiree health plan. (So, no blog–check out Early Retirement Extreme for ideas on how to retire early.) There are also high-deductible health insurance plans (as DOT mentioned) and many professional associations also have group plans available. If you have a pre-occurring condition that wouldn’t be covered for a year, maybe you could start paying for personal insurance your last year of employment so that you would be fully covered when you retire.

    (Not JUST good luck–in case the pension/retiree health insurance benefits shrink, I also have an IRA and 403b and have no debt including a paid-off house. But good luck lets those other things be enough.)

  34. Georgia says:

    I agree that SS was meant to be a supplement to help out those who needed it most. However, I find that I worked long enough that my SS is just less than 1/2 of my retirement income. I have 2 small retirements and try to save as much of one of them as I can.

    I did not retire until almost 69, but took SS at 65 in order to drop all my part time jobs. (I had never intended to retire as all I like to do is inactive stuff.) I now wish I had waited. But regrets solve nothing. My 503b is used for home maintenance and traveling to see family. This summer I’ll not save a lot as I will be traveling to NH, IN, AL, and TN.

  35. Nancy says:

    As someone who is under 40, I plan on fighting like hell to make sure SS and Medicare are still there when I retire, instead of just assuming it’s not going to be there. I hope others feel the same way. I think Medicare is the more important benefit, as even relatively healthy people wouldn’t be able to afford private health insurance when they reach traditional retirement age.

    Also, even healthy people can get cancer, or get into a car wreck and be left seriously disabled, etc. so eating healthy & exercising (which of course are good ideas) are not a guarantee of being healthy when you’re older.

    I also agree with the comments that you can’t assume there are going to be all these jobs available when we retire.

  36. Andrew says:

    I just love it when people in their 20’s state with total certainty that they will be able to retire early/ do whatever they want/ live without worries when they are in their 50’s or 60’s JUST BECAUSE they are aggressively saving right now.

    Hey there! You don’t know what the future will bring! You could get very sick. Your children could have any one of a myriad of very expensive problems. You could lose your job(s) and not be able to find others. The political, environmental, and economic problems facing this country and the world could throw a wrench into the works. The list goes on and on…

    Planning is great, and necessary, but don’t be too surprised when things don’t work exactly as you would hope.

  37. Golfing Girl says:

    I think anyone my age (35) is crazy for calculating Social Security into their retirement plan. I’m not even including my employer’s pension. I figure those “birds in the bushes” can be my fun/travel money. I also plan to live to be 95 (I have grandparents who are 90, 88, and 86 who are still in excellent health and living on their own. If I save enough money to last myself until age 95 (without a pension or SS) I should be doing just fine. And I will work until my money will last that long (unless I want to work longer). It may be 50, or it may be 72, we’ll just have to see.

  38. Rockledge says:

    With people living longer, but not having the physical stamina of their youth, perhaps we need to start thinking of another socially recognized period in life between working full-time and not working at all.

    At 52, I am “semi-retired.” I work part-time at things I enjoy. Our hope is that when my husband is 55 he will start working part-time and we will be able to spend time traveling in the U.S. while our health allows it. Fortunately, we both work in fields where that is possible and we can continue his health insurance coverage in retirement.

    We are fairly frugal and have no debts other than a house that is almost paid off. Once the kids are out of the house, we will downsize. We are considering living in an RV. (My aunt and uncle have lived in one for decades to facilitate their early retirement. There are all sorts of jobs that pay enough to cover RV expenses.)

    Ideally we and others will be able to find a way to transition from full-time work to full-time retirement in a graceful useful way, if luck and health cooperate.

  39. Kate says:

    @#36Andrew: Yes, I agree with your post. Absolute certainty about the future makes me laugh (and some say God laughs, too)because while I agree that we must be good stewards of what we earn/possess, it can all be taken away in a second by the situations you mention.
    I went to a town hall meeting held by my Congressman where citizens tried to work out how to reduce the deficit. I was surrounded by retirees who stated that we should raise the retirement age to 70. And then in the next breath they stated how HAPPY they were to be retired (age 63)because they had burned out and couldn’t work anymore. I looked at them and said, yes,many people in my age bracket (1960)might feel the same way….sigh. No one ever talks about how employers have cut back so much that many of us are doing the job of 3 people and they expect us to do this until we’re 70??? Crazy.

  40. Ken says:

    Luke @ 19 hit it on the head.

    There are plenty of “retired” people who would love to get back into the workforce; unfortunately, age discrimination and abysmal growth in the job market have become the one-two punch that keep those folks down and out.

  41. Nick says:

    I understand your feelings but without planning there is no way our goals would be obtainable. All I can say is right now my wife and I are on track and if the world around us comes down we will be better off for trying. “Failure to plan is planning to fail.”

  42. ChrisD says:

    I am always worried by the idea that you WILL be able to keep working till you are 80. Maybe you can, but maybe you can’t.
    My grandmother was in very good health all her life (running a large garden till she was in her 70s), and she is still in pretty good health *for a 90 year old*. For the last 10 years she has only been capable of living very quietly with all her needs (cleaning, cooking, laundry, bathing) taken care of for her. When family want to treat her to a day trip on a boat she has to say no because it is too tiring. Going round to someone’s house for a quiet family dinner is the most she can do. If you CAN be taken care of, this is a pleasant evening of your life. If you need to keep working, you will drop dead in 5 minutes.
    If you are in general good health it’s fine to plan to work till you are 70, but DO plan in case you can’t

  43. DOT says:

    Andrew – I started aggressively saving when I was 29 and the only thing I regret is not saving much more aggressively. Just because you can’t predict the future doesn’t mean you shouldn’t set high goals. My retirement date has changed many times through the years because of several factors you mentioned but I always planned and saved through the good years and the bad. And I can tell you one thing I am sure of..when my husband was diagnosed with cancer last year and went through 56 weeks of chemo 3x a week, having a healthy 6 figure savings and a paid off home made all the difference in his recovery. With all that was going on with his health I can’t imagine having to add the stress of wondering were our next meal may come from if we were unprepared. Because of the dreams I had as a 20 year old and the planning to back up those dreams this physical and emotional tragedy was merely a large hick up in our financial life and added about 2 years to my retirement date.
    Being 20 and saving aggressively to “retire early/ do whatever they want/ live without worries when they are in their 50′s or 60′s” is a goal everyone young person should strive for.. then readjust when life throws you a curve ball an you will not ” be too surprised when things don’t work exactly as you would hope”.Young adults should be inspired to save not ridiculed.

  44. Tara C says:

    Save early and aggressively… you never know what life has in store for you. I plan to work until 65 but you never know what can happen, so I am saving 45% of my income now.

  45. Pattie, RN says:

    I had concerns about spending money on a Master’s at my age (53) until realizing that I will likely be working for at least another 15 years. I am now an educator, where the degree=more money and more options should my current position fall to the budget ax. My degree will amortize in four years.

    We, too, had started saving young, but job losses, re-education for both of us (to fields that one can maintain into older age AND who are pretty unemployment-proof) and children’s health and education, combined with the crashes of ’87 and recently, took a big bite out of the rest. No argument that savings is NEEDED..but remember that the best laid plans of mice and men….

  46. Matt says:

    My goal is to be able to retire by the time I’m 40, but work as I want until I’m 50, when the kids are out of the house and I’m officially “free” again.

  47. SLCCOM says:

    I didn’t see anyone in these responses mentioning that really dirty word, inflation. Anyone planning to retire at 52 is, in my opinion, an idiot. Unless you have health issues that force the issue, or you are laid off and unable to find a new job, voluntarily “retiring” that early is a recipe for a miserable, impoverished old age.

    My parents bought their house in 1957 for $25,000. It would now sell for about $200,000. Try looking up food prices, and figure out where they are now. This is not going to change. Our current economic situation is already causing major inflation in food and fuel prices, and that will spread as fuel prices affect everything else. And in my 55 years, I have NEVER seen prices fall back to where they were before inflation. Investments seldom keep up with inflation, and with the crooks running our money system, I wouldn’t count on that happening. Instead, I think more people will lose more money to them, and the more they have invested, the more they will lose.

    Plan accordingly, and pray hard!

  48. jim says:

    #38 Golfing Girl said :

    “I also plan to live to be 95”

    Thats a good plan for anyone as far as I’m concerned. I recently actually wrote an article on my blog along those lines. One fact I dug up was that for a retired couple at age 65 there is about a 40% chance that one spouse will live to 95.
    If you live to retirement age then life expectancy at that point makes getting to 95 a decent likelihood.

  49. Johanna says:

    @SLCCOM: I agree that retiring at 52 and expecting your expenses to remain the same for the next 40+ years is a recipe for disaster, but inflation is something you can plan for. And I’m pretty sure that “investments seldom keep up with inflation” is just false. They don’t *always* keep up with inflation – depending on the investment and the time period – but they very often do.

  50. SLCCOM says:

    @Johanna. Sometimes they keep up with inflation, but considering what the stock market has gone through, and the fact that is isn’t an honest system, I wouldn’t count on it. A lot of people have had their entire retirement fund so badly damaged that they abandoned the idea of retirement in the past decade.

    And once you leave the labor force, particularly in your 50s, you better plan on being unable to ever reenter it.

  51. Johanna says:

    Sure, if you look at the past decade – from the height of the dot-com boom to the midst of the current mess – the stock market doesn’t look so great. But the stock market is for long-term investments, where the “long term” is not one decade, but several decades.

    If someone’s retirement fund was so badly damaged during the past decade (and they didn’t have to dip into it because of job loss, for example), it’s probably because they panicked and sold all their stocks at the bottom, and missed out on the subsequent rebound. Not that that makes their loss any less real, but it’s not the market’s fault that they messed up. Those of us who held our stock investments (and kept adding to them, if applicable) are not doing so badly.

  52. Treva says:

    “I can take a low-paying position with a charity or even do volunteer positions with some perks.”

    The whole point of volunteering is to do it without the expectation of getting anything in return. Please volunteer, but do so for the right reasons.

  53. AnnJo says:

    @52 Treva, “The whole point of volunteering is to do it without the expectation of getting anything in return. . . . do so for the right reasons.”

    Treva, people may volunteer for social status, to earn admission to Heaven, for the warm, fuzzy feeling of virtue it gives them, for the satisfaction of paying back a debt they feel to society, or in order to look down on others who are not so “virtuous”, but EVERYBODY does it in the expectation of getting something in return. “Perks” are just another reason, better than some.

    But I think most people think that the “whole point of volunteering” is to provide a needed service, and the motivation is less important than the service. Please volunteer, for whatever reason floats your boat.

  54. Kim says:

    Trent, if you are not going to have enough money to retire at 65 and will need a second career, you have a bad retirement plan. How can you continue to dole out financial advice? You don’t even have your stuff together.

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