The Great Resignation Prompts an Early Retirement for Many
November 9, 2021
We’ve certainly seen our share of shifts in the workplace and economy over the past year. In particular, millions of workers participated in what is now being called the Great Resignation. For numerous reasons, workers said goodbye to their employers during the pandemic, and many of them have not looked back.
Among those resigning workers were many Americans who were already close to retirement age anyway. Instead of looking for new employment, they have now decided to opt into a new retirement, for a number of reasons:
Health concerns due to the pandemic- Large market gains
- Inflated home values
- Federal stimulus packages
- Expanded federal unemployment benefits
In addition to those factors, the stress of the pandemic and the remote work trend might have simply frustrated workers in their fifties and sixties. Some simply decided that they felt “done”.
So, are these retired workers now living on Social Security? Actually, many of them are not! The Social Security Administration reported the largest decline of new retirement claims in nearly two decades last year. People are retiring, but they’re not claiming Social Security just yet.
It is likely that these retirees have realized something important: By delaying their Social Security claims, they can reap a larger monthly check when they claim their benefits later. Some might even be too young to file a claim, since 62 is the earliest age at which you can claim benefits.
So, how are these early retirees getting by? Some might be covering expenses with unemployment benefits and federal stimulus money for now. But with the market seeing large gains in some areas during the pandemic, those above age 59 ½ might simply be taking distributions from their retirement accounts.
Finally, will some early retirees change their minds and go back to work? That remains to be seen. But if you’re concerned about the possibility of an early retirement due to the above factors (or any other reason), give us a call so that we can discuss your situation in more detail.
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