5 Things That Can Keep You From Retiring

You have a plan for retirement, but life can come with surprises. Learn how to prepare for these five hurdles that may affect your retirement timeline. 

1. Not Meeting Your Savings Goals

Maybe you’ve been regularly investing for retirement for years — good for you! Still, it’s possible that even with good saving habits, you haven’t saved enough to cover your expected retirement costs. 

One of the things to do before retirement is to try to estimate what your expenses will be. Include less-predictable expenses like travel, emergencies, and home or car maintenance or repair.

According to Investopedia, most people can spend 4% of their retirement savings per year. So, you can estimate what 4% will be when you retire and add in any Social Security benefits or pension income you expect. If that’s not enough to cover your retirement costs, you’ll either need to adjust your retirement expenses or save more money.

2. Illness or Injury

Your retirement plan probably assumes you will be healthy enough to work until you retire. But a serious illness or injury could ding your retirement savings in two ways. 

First, you could miss work while you’re being treated or recovering. Your time off and disability insurance may not cover your salary when you’re not working, and you almost certainly won’t contribute to your retirement savings during that time. Second, depending on your illness or injury, you could have a lot of medical debt you need to repay.

You may need to save more or work longer to make up for the losses of health-related issues.

3. Family Changes

Just as you assume your health will stay the same until you retire, you probably don’t expect any changes in your family situation. But your spouse or partner could get sick or hurt, cutting into the amount they have for retirement. You could get divorced. Your children could face unexpected costs that you help pay. You might become a guardian to the children of a loved one, or care for a grandchild.

Changes like these may impact your work life and your expenses before and after retirement.

4. Debt

Ideally, you want to go into retirement with as little debt as possible. But you may have built some debt into your retirement plan that you know about and have planned for. For example, you may still be paying off your mortgage in retirement or helping your children pay off student loans.

However, your debt could climb unexpectedly, due to a lawsuit, car accident, health condition, change in your job, scam or other reasons. And your retirement savings might not be enough to cover those costs.

5. Work Disruptions

As you get to a certain point in life, you probably plan on staying with the same company until you retire. But a layoff or company closure could derail those plans. 

You might need to spend time looking for a new job, which could increase your debt and cut into your savings for retirement. And you might end up in a new position that doesn’t pay as well as your old one. If your work life doesn’t go according to plan until the end, your retirement might not go according to plan, either.

Crunch the Numbers With a Financial Advisor

Of course, you can’t plan for every possible scenario. Most of the things that could keep you from retiring on time are unexpected. But meeting with a financial advisor for retirement can help you run through the likelihood of different things happening and what they might cost. 

That way, you can prepare and make it less likely you’ll have to retire earlier than planned. Reach out to a Farm Bureau financial advisor to schedule a consultation and to make sure your retirement plan is as solid as it can be.