Confused about whether to delay your retirement? Here are 4 tips for effective retirement planning

Date : 07/09/2022
Read: 4 mins

Four reasons to delay your retirement!

With every passing day, the number of people opting for delayed retirement is significantly increasing. You may be ready to call it quits, but there could be various financial compulsions that you need to keep in mind. Also, delayed retirement leads to fewer years that you would need your savings to support you. Hence, several factors are to be considered before you can make a well-informed decision. You need to consider retirement financial planning, the kind of lifestyle that you desire to have after retirement, whether you have built the required retirement corpus, if you need to leave a financial legacy, and so on.

Four reasons for delayed retirement

Here are four reasons to delay retirement that can help you make a wiser choice:

Insufficient retirement corpus: Insufficiency of funds for the desired post-retirement life is undoubtedly the primary reason behind delaying retirement. Having an estimate of your retirement corpus could thus be a game changer in planning your retirement. Here, one must also consider life expectancy that has now increased by more than 10 years. This implies that you need to expand your retirement corpus. One major contributing factor that you need to keep in mind here is the inflation in the post-Covid era. Higher expenditure besides increased medical and educational inflation means you would not be able to save as much as earlier. This is because you also need to save up for medical emergencies or if you set aside some funds. This could be for various reasons like leaving financial legacy, the educational needs of your children, daily family expenses, and so on.
You have a debt: If instead of retiring, you decide to work for a few more years, it can help you to clear your debts. This relieves you of the burden to clear any debt using your retirement savings or retirement funds. Thus, if you were not able to repay a loan within your service years, you may need to delay your retirement to pay it off. This is another important factor that you must consider before deciding for or against delayed retirement.
Unavailability of medical corpus: As you are already aware, the expenses for medical and healthcare purposes have been on the rise. Thus, it is important that you have medical insurance and if you don’t, you’ll need to keep working to gather funds. If you do not have the required funds for a retirement benefit, it is important that you delay your retirement. This way, you can avoid being a liability for your children and be able to support yourself as you grow old. In a way, it keeps you both physically and mentally active and contributes to financial planning.
Incomplete goals: The age for achieving one’s life goals has been significantly pushed back with the extension of the marriageable age. The time taken by the youth to land a stable career has also consequently increased. Thus, many senior citizens have to keep working to make their family’s ends meet till the children are stable.

Thus, while finance is the predominant reason for delaying one’s retirement, it is not the only one to boost your retirement. The risks associated with outliving your retirement corpus get significantly reduced.

Planning your retirement can thus be highly beneficial for both you and your family. Working can keep you occupied, connected, economically supported, and even happier. It is also a very well-known fact that for most people, their earnings are highest during their last few years in service. It is important to increase your savings as much as you can and delaying your retirement can help here. You can also avail various facilities by delaying your retirement. These include corporate health insurance for you as well as your spouse, that too at much lower rates.

Another advantage of delayed retirement is that you do not have to be financially dependent on your children. Thus, you won’t have an impact on their financial planning and live an independent life. Besides, there are several benefits of delayed retirement on your health. Besides, studies have shown a positive impact on the health of people who opted for delayed retirement. Thus, it is really important to keep in mind all the aforementioned factors and then postpone retirement. Only then will you be able to make a better, wiser, and more suitable retirement choice that affects not just you but your whole family.

When can I retire? | How much Retirement Corpus is enough?

Four reasons for delayed retirement

Here are four reasons to delay retirement that can help you make a wiser choice:

Insufficient retirement corpus: Insufficiency of funds for the desired post-retirement life is undoubtedly the primary reason behind delaying retirement. Having an estimate of your retirement corpus could thus be a game changer in planning your retirement. Here, one must also consider life expectancy that has now increased by more than 10 years. This implies that you need to expand your retirement corpus. One major contributing factor that you need to keep in mind here is the inflation in the post-Covid era. Higher expenditure besides increased medical and educational inflation means you would not be able to save as much as earlier. This is because you also need to save up for medical emergencies or if you set aside some funds. This could be for various reasons like leaving financial legacy, the educational needs of your children, daily family expenses, and so on.
You have a debt: If instead of retiring, you decide to work for a few more years, it can help you to clear your debts. This relieves you of the burden to clear any debt using your retirement savings or retirement funds. Thus, if you were not able to repay a loan within your service years, you may need to delay your retirement to pay it off. This is another important factor that you must consider before deciding for or against delayed retirement.
Unavailability of medical corpus: As you are already aware, the expenses for medical and healthcare purposes have been on the rise. Thus, it is important that you have medical insurance and if you don’t, you’ll need to keep working to gather funds. If you do not have the required funds for a retirement benefit, it is important that you delay your retirement. This way, you can avoid being a liability for your children and be able to support yourself as you grow old. In a way, it keeps you both physically and mentally active and contributes to financial planning.
Incomplete goals: The age for achieving one’s life goals has been significantly pushed back with the extension of the marriageable age. The time taken by the youth to land a stable career has also consequently increased. Thus, many senior citizens have to keep working to make their family’s ends meet till the children are stable.