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Originally Published: Aug 08, 2022
Originally Published: Aug 08, 2022 Last Updated: Aug 08, 2022 6 min read
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Your current financial calculus could be keeping you up at night, as your dream retirement seems to drift further away. Spiraling inflation and a whipsawing stock market are attention hogs, but it's definitely possible to make a few moves now that can keep you on course to retire.

This year, fewer people — 47%, down from 53% a year ago — said they felt confident about being able to retire comfortably, according to Schwab’s 2022 401(k) Participant Study. Retirement anxiety also soared, with 13% of people saying they weren’t at all sure they'd be able to retire, up from 8% last year.

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About 25% of U.S. adults say they will need to delay retirement, according to BMO Harris Bank’s quarterly Real Financial Progress Index. Those feeling the most impact? Younger Americans. Nearly two-thirds of those ages 18 to 34 said they planned to cut back on retirement account contributions

People with just a few years to go have much less time for the stock market to smooth out the bumps. For some, putting off retirement may make more sense.

Reasons to delay retirement are plenty, according to Timothy Speiss, a partner with Eisner Advisory Group. People want to remain active and earn more, and the longer you put it off, the longer you’ll have for investments to grow. Remember to factor in your Social Security. Depending on how long you can delay claiming, you could boost your monthly benefit by as much as 124% to 132%.

An experienced advisor should be de-risking your portfolio as you near retirement, says Priya Malani, co-founder and CEO of Stash Wealth. “This means that a temporary downturn, no matter how large, should have little to no impact on your portfolio,” she says.

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Retirement planning during uncertain times

Before you resign yourself to another few working years, you might want to take inventory and see if you can in fact start a work-free life. A combination of some or all of the following strategies may make it possible to take back some control over the timing of your retirement.

1. Be flexible about work hours

Your retirement years don’t have to be completely either/or, says Carolyn McClanahan, a certified financial planner and founder of Life Planning Partners. “Your ‘human capital’ or ability to work is the safest asset you can own,” McClanahan says.

Think about some tweaks to your work schedule, such as cutting back at work instead of quitting entirely. This way, you can take time to make the transition “a nice buffer financially, especially if the markets are doing poorly,” McClanahan says.

2. Make a new investing plan

Instead of giving in to panic over market swings, come up with an investing plan. Say the current stock market is wreaking havoc with your nest egg. Now could be the time to go more conservative. “Consider a strategy focused on the protection of your investments with a more conservative investment asset allocation,” Speiss says. Your goal should be how to generate income to fund your spending needs.

Consult with a professional advisor if you feel uncomfortable doing this on your own, but remember there are lots of online resources and places to learn how about investing.

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3. Calculate how much it costs to be you

If you don’t know how to figure the cost of your monthly life, write down your expenses. Gather a few old credit card statements for items that are easily overlooked, such as streaming services, cell phone plans and subscriptions. Most people underestimate their monthly spend by about $133.

Next, look at retirement as well as non-retirement plan investments, and see how they match up with what you’ll need to spend over a time horizon. If this seems too complex, Speiss recommends meeting with an investment advisor.

Malani suggests using an online calculator to test whether your nest egg will last through 30 years of retirement.

4. A different kind of retirement

“If you are burned out on your old job or don’t have the ability to cut back gradually, take a job doing something to bring in some pocket change,” McClanahan says. Beyond the money, which is often the top factor people look at when considering a job, remember the social stimulation and educational benefits of professional engagement.

Two clients of McClanahan’s retrained after retirement. One got a realtor’s license. The other, a former veterinarian, used his kids’ leftover 529 funds to become an electrician.

5. Check your emotions

Investing and emotions do not mix.

“The thing about markets is that when they go down, they always go back up,” Malani says. It’s natural to panic during rocky markets, but stick to your investing strategy.

“Those who let their emotions get the best of them might have sold their investments or even discontinued contributions,” Malani says. “Just a few years later, those that stayed the course wound up being up over 200% from the bottom.”

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