When it comes to retirement planning, there are a lot of things to consider. One of the biggest is this: How long should I work? Well, you can actually stretch your retirement funds further, and pad yourself better, by working a little bit longer. I’m not talking 10 years longer, or even 5 years longer, than you planned. You might even try a little semi-retirement.
Living longer and better
Because we’re healthier when we reach retirement age, and can expect to live 20 or even 30 years beyond retirement (longer if you retire earlier), your retirement savings are going to need to last. You would be amazed at what working just two more years can do for you, according to Motley Fool:
Work a little longer. Not a decade longer (unless you really love your work and can’t think of anything else to do), but just a few more years. Remember how, with my initial example, you’d need to earn an annual average of 27%? Well, if you stretch your retirement to 10 years in the future, instead of eight, you’d need to grow your nest egg by just 21% annually. Make it 12 years away, and you’d need to earn around 17.5%. That’s still too much to expect automatically, but it’s a lot more reasonable.
But you can also consider semi-retirement. Many people are leaving jobs that they like only moderately (or not at all) to work part-time doing something they love. This can keep you healthy and active, and help you ease into your retirement funds, rather than straining them all at once. So, if you work 2-4 years longer, and get a fun part-time job when you retire and do that for as long as you want to, then you can really stretch your nest egg. It will keep earning interest, and you will make it last longer. Just remember to really in time to enjoy a lovely vacation.