Like most people, I sometimes indulge in daydreaming about how I would spend time if I were currently retired. There is no doubt that I would be happy to fill in my extra free time. But the truth is, even if I were sitting on a few million dollars now, I probably wouldn’t actually leave the workforce. Here are three reasons why.
(Kailey Hagen)
1. Retirement planning is already unpredictable enough
Planning a standard retirement age of 20 to 30 is already a challenge. You never know what costs will come to you, which means you never know how much you need to save. You just have to speculate educationally and constantly adjust in order to focus on your goal of saving.
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If I were to retire today at 30, I would probably look at 50 to 60 years of retirement. That means I would have to worry about another 20 to 30 years of unpredictable costs. This does not mean that it is impossible to plan a pension of that length, but it does involve risk.
An unplanned health condition could deplete my savings much faster than I originally planned, leaving me with the difficult choice of returning to the workforce or reducing my annual spending, and I hope I don’t run out of money as I get older.
This scenario could still play out, even if I wait until I retire by the 60s. But until then, I’ll have more years behind me than in front of me, so my savings won’t have to last that long.
