WorkHappy Conclusion: Top November Business Tips From Joe Szynkowski (Copy) | Business


I often “joke” with my wife that I want to retire at 40. I put joke in quotes because she thinks I’m stupid.

Please don’t tell her, but I’m serious.

This wacky dream comes from watching executive clients after executive clients complain about how much they work in their 50s and 60s, and how eager they are to cross the professional finish line. They regret not having spent more time with their family and find it difficult to explain their unhealthy obsession with work.

As a person who enjoys working, I doubt I will ever retire fully. But hanging up at 65 and hoping my health will last long enough for me to reap the rewards of my hard work seems downright depressing.

Nearly half of Americans plan to retire before age 62, an increase of two percentage points from two years ago, according to the New York Federal Reserve.

New research explains this trend reversal in retirement.

Goldman Sachs has just figured out why the labor shortage isn’t going to go away anytime soon: 60 percent of missing workers have retired. And a lot of these people are not of normal retirement age.

Labor shortages continue to persist, even after the government has shelled out its latest round of stimulus checks. As the economy trudges into a post-pandemic recovery, many Americans are simply not waiting for a rebound.

Goldman’s report released last week found that 3.4 million people who left the workforce are over the age of 55. About 1.5 million of these were early retirements and one million were normal retirements.

These two sets of retirements “are unlikely to reverse,” according to Goldman.

These figures surprise many experts. Research by the Federal Reserve Bank of Kansas City has predicted a normal retirement rate of 1.5 million in the first year and above of the pandemic. Economics researchers typically don’t miss their targets by more than 100%, which tells us that many Americans think more for themselves.

This is bad news for businesses across the country. Restaurants close early – or not open at all – due to labor shortages. Suppliers are struggling to fill and deliver their orders. And healthcare organizations are seeing higher attrition rates among nurses and administrative professionals.

Scary stuff, but let’s look at the positive: If you’re up for the job, there are plenty of opportunities out there for you.

Why do people retire early?

Many factors come into play in the race for early retirement. The stock market is booming and home values ​​are exploding, making it more viable for people with these types of investments to withdraw money and retire early.

For others, health is a major contributor. Working through a public health crisis has inspired many older Americans to put their well-being first. They are probably nervous about returning to the office, especially since they are in a category at higher risk for serious health complications from COVID.

Taking early retirement means that you will not be able to immediately take advantage of Social Security benefits. Experts recommend closing the gap with retirement savings.

It starts with taking advantage of your employer’s pension plan. In 2019, only 56% of workers were enrolled in such a plan. We’re starting to see companies attract workers with more robust 401 (k) matching programs, so talk to your boss about your options.

How much do I need to retire?

Many financial experts advise retirees to safely withdraw about four percent of their savings per year without running out of cash, provided they are on top of regular spending.

For example, if your annual expenses are $ 30,000 per year, you would need at least $ 750,000 in retirement savings for 25 years of comfortable retirement. If those numbers seem out of reach, try an online calculator to figure out how much to save, and work with a financial advisor to find out when and how to meet your nest egg goals.

To the millions of people who are opting for early retirement, thank you. Your contributions will be missed but we thank you for passing the baton.

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