3 Signs Retiring at Age 62 Isn't a Smart Move for You


Age 62 is the earliest age you can sign up for Social Security. Because of this, you may be thinking of filing for benefits as early as possible and bringing your career to a close.

But retiring at age 62 carries some risk — whether you claim Social Security at that age or not. Here are a few signs that 62 is not a great age for you to retire.

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1. You don’t have a lot of savings

It’s one thing to retire a bit on the early side if your IRA or 401(k) plan has a $2 million or $3 million balance. But if you’re short on retirement savings, then retiring at age 62 could increase your risk of depleting your nest egg at some point down the line.

Plus, if you’re 62 and are able to keep working even a little bit longer, that could make it so you’re able to add to a nest egg that may be lacking in funds. That way, you’ll perhaps be less reliant on Social Security as a retiree in case benefit cuts happen. And you’ll also have more leeway in case unexpected expenses arise.

2. You have health issues

Going without health insurance for any stretch of time is an unwise move, regardless of the circumstances. But if you have health problems, then you absolutely cannot afford to go without health coverage in case one of your issues flares up and requires treatment.

Medicare eligibility, however, does not begin until age 65. So if you retire at 62 and lose your health coverage in conjunction with leaving your job, you might have to scramble to afford health insurance that you put in place yourself. Or you might end up with an inferior plan that leaves you with high out-of-pocket costs.

This isn’t to say that you won’t incur your fair share of expenses as a Medicare enrollee if you’re someone with health problems. But you might pay a bit less for Medicare coverage, depending on your circumstances, compared to the cost of buying your own plan elsewhere.

3. You have a family history of longevity

Maybe you don’t have health issues of concern. Maybe you’re in the opposite boat — your health is strong and you expect to live a nice, long life.

That’s a good thing in theory. But from a savings perspective, it could increase your chances of eventually running out of money. So you may want to be careful about retiring in your early 60s if there’s a strong chance you’ll live until your late 90s.

Plus, think about it this way. Over time, retirement could get boring. So if you expect to live a long life, you may want to put it off.

Retiring at age 62 isn’t automatically a poor choice. And if it’s an option you’ve saved for, then by all means, go for it. But before you rush to retire at 62 because that’s when Social Security first becomes available, consider the potential drawbacks involved, and make sure you’ve carefully thought them through.



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