My friend’s father retired recently at 62. That wasn’t his plan initially, but his job was making him miserable.
He worked long hours, had constant deadlines, and faced a ton of stress. And while he initially hoped to work until his mid-60s or beyond, he retired early because he just plain couldn’t take it anymore.
Because my friend’s father had nice savings at that point, he didn’t have to claim Social Security as soon as he retired. Doing so would’ve been an option since you can sign up for benefits once you turn 62. But doing so also means slashing your monthly benefits for life, which my friend’s father didn’t want to do.
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But early retirees don’t always have that option. Often, retiring early means filing for Social Security early and reducing a major income stream for life. So, if burnout at work is leading you to contemplate an early retirement and Social Security filing, you may want to consider an alternative route.
Make a change instead of calling it quits
It’s hard to have patience in a stressful job at any age. But by the time you’re nearing the end of your career, you might have even less energy to maintain an intense work schedule.
That’s understandable. But rather than retire a few years early and claim Social Security prematurely at the same time, you may instead want to see about making a career change or scaling back to part-time work at your current job or in your current field.
Even if you enter retirement with a nice amount of savings, that money could run out on you eventually. Social Security, on the other hand, is set up to pay you your monthly benefit for life. So, reducing that benefit by retiring and claiming it early could lead to a host of financial stress down the road.
If you feel like you can’t stand to spend another minute at your job, by all means, quit. But don’t automatically retire. Instead, try working in another field — something more enjoyable and less stressful.
It’s true that you might take a significant pay cut by switching fields later in life. But if you can earn just enough to cover your expenses without Social Security, you could hold off on filing for benefits a bit longer, thereby potentially setting yourself up with a much higher monthly payday for life.
Similarly, maybe you don’t hate the work you do per se, but the hours are downright exhausting. At that point, it’s time to have a conversation with your employer about shifting to a part-time schedule. And if they don’t agree, see whether another company will take you on a part-time basis. This arrangement, too, might put just enough money in your pocket that you can hold off on claiming Social Security a while longer.
Don’t rush into early retirement
Retiring early can have unfavorable financial consequences. It could mean not only filing for Social Security early but also having to tap your nest egg prematurely, thereby increasing the risk of it eventually running dry.
If you’re sitting on millions of dollars in savings, are burned out at work, and want to end your career early, so be it. But if you don’t have nearly that same financial cushion, don’t rush to wrap up your career on a permanent basis. Instead, look into other work opportunities that might pay you just enough to stay afloat while you leave your Social Security benefits unclaimed and your nest egg untapped.
