TheStreet

Log In

Receive full access to our market insights, commentary, newsletters, breaking news alerts, and more.
Forgot your password?Don't have an account? Sign Up Here

Join Us

Receive full access to our market insights, commentary, newsletters, breaking news alerts, and more.
Already have an account? Login here
TheStreet
RETIREMENT
401KESTATE PLANNING
IRAS
SOCIAL SECURITY
Search
What to Do When You Can’t Retire

What to Do When You Can’t Retire

MainStreet consulted the experts to see what baby boomers in financial straits can do if they find the finish line increasingly farther away.
Author:
Jeanine Skowronski
Publish date:
Nov 18, 2010 7:00 AM EST
There are two keys strategies to planning for retirement: The first is to start early, and the second is to save. “Living within your means after you retire is living within your means before you retire,” Craig Brimhall, vice president of retirement wealth strategies at financial planning agency Ameriprise, explains. While this is universally considered the best practice, what can you do if you’ve mismanaged your finances – something more Americans are guilty of, as evidenced by more and more studies? MainStreet consulted the experts to see if those who had reached retirement age (which remains, as of press time, age 65), but were in dire financial straits could do anything to expedite the process. We found that while their options are limited, there are ways to improve their finances. Photo Credit: premus
There are two keys strategies to planning for retirement: The first is to start early, and the second is to save. “Living within your means after you retire is living within your means before you retire,” Craig Brimhall, vice president of retirement wealth strategies at financial planning agency Ameriprise, explains. While this is universally considered the best practice, what can you do if you’ve mismanaged your finances – something more Americans are guilty of, as evidenced by more and more studies? MainStreet consulted the experts to see if those who had reached retirement age (which remains, as of press time, age 65), but were in dire financial straits could do anything to expedite the process. We found that while their options are limited, there are ways to improve their finances. Photo Credit: premus
“This may seem obvious, but you’re going to have to work longer than you planned,” Richard Barrington, certified financial adviser, says bluntly. Fortunately, many prospective retirees forget that the longer they work, the less they’ll need to save. Although on the flipside, as Barrington says, “you can’t do anything to increase your life span.” The silver lining here is that you may not be stuck in your current job. Income from a part-time job may be enough to alleviate a shortfall in assets, Brimhall says. “Oftentimes, a little bit of money will take off a huge amount of pressure,” he says, explaining that people can slowly segue into retirement. Photo Credit: KB35
If you do need to maintain a full-time job, or your salaried position is too good to give up, stop yourself from adopting an exit mentality. “Don’t approach your job as if you are winding down,” Barrington says, explaining that a passive approach to work can cause you to be passed up for higher paying positions, or cost you a raise that could expedite your retirement. Instead, manage your career as if you are in it for the long haul. “Be aggressive and go for every opportunity your company offers,” Barrington says. “You might as well make the most of it.” Photo Credit: sidewalk flying
Maintaining a monthly income is only one piece of the puzzle. “It may be easy to say, ‘I’ll go out and deliver pizzas,’ but in many cases that’s just not practical,” says Tony Walker, author of Worry Free Retirement. Instead, Walker advises those looking to retire to focus on driving down monthly expenditures. “You’re only ever going to have so much fixed income at your disposal,” he says. Cutting costs can be simply done. Walker suggests using the library more often, shopping at Goodwill or consignments shops, or shutting your hot water heater off intermittently. Changes can even be as a small as buying cheaper bread. (“It makes better toast,” Walker quips.) Check out this MainStreet article for more ways to save. Photo Credit: sneakerdog
Those looking to take drastic measures should consider taking out a reverse mortgage on their home. Reverse mortgages allow homeowners to borrow money from banks against the equity of their home, and because the loan hinges on the value of your home, repayments on reverse mortgages are not required until your house is no longer your principal residence. Of course, the downside here is that taking out a reverse mortgage means you won’t be able to leave your house to your children. The bank, instead, will recoup the loan, plus fees when the home is sold. And if there’s anything left, your kids will get it. As such, Walker says “reverse mortgages are a great resort, but they should be a last resort.” Another option Walker suggests is selling the home and renting it out during retirement. Photo Credit: Carey Serin
Recent studies indicate that retirement may not be all it’s cracked up to be. Consider this study published in the Journal of Economic Perspectives that found that the sooner you retire, the sooner your memory and cognitive abilities begin to decline. An Ameriprise survey released last month also found that retirees these days are less likely to feel as if they are living out the golden years of their dreams. It also found that fewer Americans are using age to determine when they retire. “We’re seeing that a lot of people actually quit and then contract back,” Brimmhall says, explaining that many people who can retire often don’t due to financial anxieties, fear of health care costs or even a personal desire to stay in the workforce. “People these days understand longevity. They say to themselves, ‘I’m not going to just golf the whole time.’” Brimhall suggests would-be retirees adopt the same type of attitude. “Retirement is a 20th century phenomenon,” he says. “These days, many people are starting to rethink it.” Photo Credit: Ed Yourdon
Join the MainStreet team and other readers on our lively Facebook page! Discuss our newest stories and get links to breaking content, automatically. Click here to add us. Photo Credit: Facebook.com

These Happy Golden Years

There are two keys strategies to planning for retirement: The first is to start early, and the second is to save. “Living within your means after you retire is living within your means before you retire,” Craig Brimhall, vice president of retirement wealth strategies at financial planning agency Ameriprise, explains. While this is universally considered the best practice, what can you do if you’ve mismanaged your finances – something more Americans are guilty of, as evidenced by more and more studies? MainStreet consulted the experts to see if those who had reached retirement age (which remains, as of press time, age 65), but were in dire financial straits could do anything to expedite the process. We found that while their options are limited, there are ways to improve their finances. Photo Credit: premus

1 / 7
Tags
terms:
Retirement
By
Jeanine Skowronski
Wall Street Lead
JIM CRAMER

Game Plan: Cramer's 'Mad Money' Recap (Friday 1/15/21)

  • By Scott Rutt
With a Strong Fourth Quarter, a Comeback Looks Likely for BlackBerry
INVESTING

BlackBerry, Palantir, Charah: 5 Top Stock Gainers for Friday

  • By Rob Lenihan
How Joe Biden's Victory Could Entice Wall Street To Increase Investments In Chinese Markets
MARKETS

Stocks Finish Lower as Wall Street Scrutinizes Biden Relief Plan

  • By Joseph Woelfel
3D Systems Stock Rises in Premarket Trading on Mixed 4Q Results
INVESTING

3D Systems, Stratasys Fall as JPMorgan Turns Bearish

  • By Tony Owusu
A Tesla store in Hangzhou. Xpeng is one of three Chinese electric vehicle start-ups viewed as potential rivals to America's Tesla. Photo: Handout
INVESTING

Exxon Mobil, Tesla: Upgrades and Downgrades

  • By Rob Lenihan
Apple's Tim Cook Reportedly Seeking New Directors to Add to Board
INVESTING

Apple CEO Tim Cook Says Parler Suspension and Free Speech Unrelated

  • By Vidhi Choudhary
Amazon Warehouse Lead
INVESTING

6,000 Amazon Employees in Alabama to Vote on Joining Union

  • By Dan Weil
Palantir Technologies
INVESTING

Is Palantir Stock Set to Break Out and Retest Highs?

  • By Bret Kenwell
TheStreet
  • Terms Of Use
  • Privacy Policy
  • Advertise
  • Reprints
  • Customer Service
  • Data
  • Topic Archive
  • Subscriptions
© 2021 TheStreet, Inc. All rights reserved. Action Alerts PLUS is a registered trademark of TheStreet, Inc.