Delaying Retirement

Delaying Retirement

Dear Garden State Trust:

I was planning on retiring later this year, but I’m having second thoughts. My 401(k) has gone down in value, just when the cost of living is going up at rates I haven’t seen since I entered the work force after college. What do you think?

—Reconsidering the Retirement Date

Dear Reconsidering:

You have plenty of company. According to a CNBC report of a survey conducted in April of this year, 25% of Americans are now expecting to delay their retirements. Some 36% have reported that they are already reducing savings to have enough money to meet monthly expenses. More than 40% say they are reducing spending in grocery stores and on restaurants already, but still more food inflation is expected by many observers later this year.

You are caught between a rock and a hard place. Your retirement expenses most likely will be higher, perhaps much higher, than you have projected, while the resources you have to meet them probably won’t create as large an income stream as you were hoping. It’s true that some routine expenses are reduced during retirement, such as the costs of commuting and business clothing. But other expenses may go up during retirement, for travel and entertainment in the early years and health care later on.

It is prudent to reevaluate your retirement start date now, if you have the flexibility to do so. It gives you more time to build a larger base of retirement capital. Continuing to work may increase the Social Security benefits to which you become entitled, depending upon your age. Whatever you decide, it is generally recommended that most people should enroll in Medicare when they turn 65, even if they keep working.

Still, money is but one consideration among many in choosing the appropriate retirement start date. In that same survey some 55% of respondents said their bankers were crucial in helping them to meet their financial goals. If you would like advice tailored to your unique circumstances, we invite you to make an appointment with one of our officers.

Do you have a question concerning wealth management or trusts? Send your inquiry to

(June 2022)
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