TIPS FOR HANDLING UNWANTED RETIREMENT
If and when that unexpected and unwanted retirement does happen, here are eight tips on what to do.
1 Prepare for a range of emotions, says Janet Taylor, a New York City psychiatrist and consultant with AARP’s Life Reimagined. “Feel them and process them, but avoid feeling compelled to act on your feeling immediately,” she says.
“Relax,” says Freedman. “Don’t panic. What you may not be able to do tomorrow, may be an opportunity to do something different down the road.”
2 Examine your budget. “Make sure you are comfortable with how much it costs to support your living expenses,” says Freedman. “Many people don’t know what they spend. Grab your bank statements. Look at the total withdrawal number, add up six months of total withdrawals, multiply by two (giving you a year) and divide by 12.” When you are faced with a surprise entry into retirement, you have to identify your fixed expenses and your discretionary expenses, Freedman says.
3 Set up a time to talk to human resources, if possible. “Assess your resources and sources of support,” says Taylor. “Lean on them. You are not alone.”
4 Look at your current lifestyle. “Look at your current living environment and say, ‘Can I support this lifestyle?’” says Freedman. You might have to downsize a bit. “Maybe it’s stopping the support you are providing to your children and grandchildren,” Freedman says. “There are a lot of things you can consider.”
It may not be easy, says Sullivan. “We can get you to be financially independent, but you have to make some major changes. Some people will go into denial and keep living as they were and not making changes, because it is an emotional issue. You know it will be a train wreck if they keep going that way. Counseling them on the emotional side is just as important as the financial side.”
5 Do not raid your 401(k). “It still is best to conserve assets in your 401(k) plan if at all possible because they are tax deferred, and you may pay penalties,” says Schlichter. “It should be the last resort for an employee unexpectedly laid off.”
6 Consider an encore career. “Maybe you look at unexpected retirement as a gift — as a chance for something you always wanted to do,” says Sicchitano. “Retrain and enter a new chapter. Our first question is how retired are you going to be?”
7 If you are retiring for health reasons and are unable to work, visit the Social Security Administration. “You can apply for disability benefits,” says Freedman. “It’s the main reason Social Security was built. It was really a widow’s, orphan’s and disabled person’s benefit. If you can’t work for health reasons, you can apply for disability benefits and collect at whatever age you might be. If you have young children you can collect checks for them, too.”
8“Pay attention to your physical health,” says Taylor. “Changes can be stressful. Monitor your sleep and strive for healthy diets and regular exercise to combat stress.”