This week, I’m talking about how Covid will change how you plan for retirement. 

Today, I’m talking about how Covid will accelerate early retirements. At the beginning of August one of my clients unexpectedly retired. He was planning to work another 2-3 years, but Covid changed all that. 

I spoke to another client the other day who thinks he may be on the chopping block at his company and wants to know if he could retire or if he would have to start looking for another job in his early 60s if he got laid off. 

The fact is that during a recession, many workers who are close to retirement end up facing an early retirement. Those of you who are the closest to retirement are also often the highest-paid, so layoffs of older workers allow companies, especially larger ones who are more likely to see employees as more of a number or a line item expense, to cut costs during difficult economic times. 

In January, a survey from Allianz Life Insurance Company found that half of Americans retired earlier than they expected. A majority of respondents said that they did so for reasons outside of their control, with 34% citing job loss and 25% health-care issues. Now keep in mind that was in January - before Coronavirus. Those numbers are likely to go higher during this pandemic.

The bottom line here is that Covid will most likely change the retirement timeline for many Americans, so it’s important that you look at your options and determine if you could retire early, and if not, what you’ll do to ensure that the Coronavirus recession doesn’t wildly change your plans for retirement. 

That’s it for today. Thanks for listening. My name is Ashley Micciche and this is the One Minute Retirement Tip. 

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