With the economy in free fall, and the stock market up and downs, many individuals nearing retirement and worried, and for good reason. Last week, the federal government announced unemployment numbers, and they are far from good. Jobless claims due to the coronavirus reached 36.5 million. Economists are expecting that number to grow. With the economic outlook so bleak, many nearing retirement are wondering if 2020 is the right year to leave their careers.
With the ups and downs of the stock market, postponing retirement gives 401(K)s a chance to rebound a bit. Experts advise, if you can stay in the workforce, you should. Continuing to work is one of the best ways to ride out an economic downturn. Even working part time can help aide in the retirement transition.
Postponing retirement by a year or two can give retirees some room to breath. Selling stocks during a downturn means locking in losses. Continuing to work allows for the US economy and stock market to recover. In turn that 401(K) could look a lot healthier come 2022.
As expected, as life span increases so does the retirement age. Given the staggering job losses, its safe to assume that pushing your retirement age out will no longer be choice but a necessity. Even for those no where near retirement age.
Many families aren’t able to save during this time of crisis, in fact, many have had to pull from retirement accounts. This will only cause a further delay in retirement age. If you’re considering pulling from your accounts, make sure to file with the IRS. There are a momentary pause in early fee withdrawal due to the CARES Act. The only catch, you must repay the amount taken out within two years.