Factors to Consider for Your Early Retirement

Factors to Consider for Your Early Retirement

Sometimes, many people are, forced to; or find themselves having to retire early.

Unplanned early retirement should not be, looked at as a curse or a punishment but as a time to relax and rejoice. Most of the time when a person has to retire or is, forced into retirement it is because of a serious reason. Extreme early retirement or retiring before age 50 is becoming increasingly popular though many have never even heard the words. If you are unfamiliar with the concept, you probably have many questions. Do know more in detail about Fee Based Financial Services and Top Financial Advisors in Mumbai.

The most often reason for unplanned early retirement is health. A person in their thirties or forties may be diagnosed with a serious or sever illness. The illness prevents the person for continuing to stay within the general workforce.

Treatments for the illness may be time consuming or the body may be too ill to even, try to work. This is one cause of a person having to retire early.

Another reason for unplanned early retirement could be an accident. An unexpected accident on the job or a vehicle accident can cause a person to retire

before they had planned to. No one can foresee the future and accidents do occur no matter how careful people are or how many safety precautions are used.

If you are so fortunate to be offered early retirement, take it without hesitation.

Why? Because of the aging component of retirement. Retire while you can and enjoy retirement longer. Offering early retirement is a popular way for corporations to cut overall costs.

Most common factors when considering an early retirement package.

What is included for compensation?

When you are offered an early retirement package most companies will make an offer to compensate you or even to entice you into taking an early retirement package. If you have put in at least 20 years of honorable service with a company they will evaluate your record and make an offer accordingly.

What type of health benefits will you receive?

With the rising cost of health care you will want to make sure that your early retirement package includes continued health care benefits. You will need to negotiate how much of the monthly premium you will be responsible for. One other key aspect that is often overlooked is your location. If you decide to move out of state or even to a new location within your state will you still have the same coverage benefits?

Will Early Retirement Affect Your Pension Plan?

If you decide to accept an early retirement package you will want to calculate the difference between retiring now and perhaps five years later. How much loss of monthly income will you suffer by accepting an early retirement package?

Will You Be Able to Afford Early Retirement?

Hopefully you have planned ahead and set yourself up for early retirement. If not, you will need to do some calculations and make sure you can afford to accept an early retirement package. It may be a matter of re-adjusting your living environment to enjoy the lifestyle you want to live when you retire.

Will You Be Able to Mentally Handle the Change?

This key factor to accepting an early retirement package is often over looked. If you are used to the daily routine of working with several other co-workers you may find it to be a rather difficult adjustment once you are no longer going to the office on a daily basis. There are many things you can do to reduce the stress of this, but it is something you must consider before you jump on the early retirement package being offered.

Some of the folks that I knew, with no kids at home, college over with, actually agonized over this decision. The reasons they gave for not grabbing this offer were: • All I have done is work, what will I do?...their self-image was identified with what they did at work. If this is you, it is important to retire to something and not just away from work. Take the time to make a list of what you want to do in retirement. Of all the reasons for not taking early retirement, this group was the saddest. • I need my salary to meet my expenses. Folks never consider spending less when they are retired...they can and should. Buy that RV and take off, you will soon realize that you do not need that big house...your stuff is costing you money. Retiring and spending less is a reality not considered by most folks. You can do it. • I only have 8 years to 65...I am going to wait. They are going to wait, become less healthy, pick up infirmities, if do not already have them, and have less years to enjoy retirement. One study of a large corporation retirees showed that people that retired from that company at 50 lived to be 86.

Personnel that retired at 65 lived an average of 18 months. If that study has the slightest bit of validity, you can see why early retirement makes sense.

Life is a journey. Extreme early retirement can either be a brief detour or a whole

new path to a completely different destination - it just depends upon you!