Nearly a quarter of Americans over 50 have decided to postpone their retirement plans, up from 14% last year. This shift reflects growing anxiety about economic uncertainty and whether they’ve saved enough to stop working, according to the third annual survey from F&G Annuities & Life.
The trend hits particularly hard for Gen X, born between the mid-1960s and 1980, now entering their pre-retirement years with concerns that weren’t as prominent for previous generations.
The survey reveals financial worries are driving these decisions. Half of those delaying retirement cite economic volatility as their primary concern.
The retirement readiness gap
The numbers paint a sobering picture. While financial experts often recommend having eight to ten times your annual salary saved by retirement age, the median savings for 55-year-olds sits at just $50,000, according to Prudential Financial research. That’s nowhere near enough to fund a comfortable retirement, especially when you consider that many people could live 20 to 30 years after leaving the workforce.
For Gen Xers who came of age during multiple economic downturns, this savings shortfall feels particularly acute. They’ve weathered the dot-com bubble, the 2008 financial crisis, and pandemic-era inflation while trying to build their nest eggs.
Why Gen X is hitting pause
The F&G survey reveals several key factors pushing Gen Xers to extend their working years. Forty-four percent worry about inflation eating away at their purchasing power, while 34% fear a potential recession or stock market downturn could devastate their savings.
These aren’t unfounded concerns. Speaking with CBS MoneyWatch, David John, a senior policy adviser at AARP, notes that the majority of Americans nearing retirement age share these concerns. He has observed people cutting back on retirement contributions or even raiding their accounts to cover unexpected costs, a practice that provides short-term relief but creates long-term problems.
“Of course, that helps in the short run, but that means that you have even more people who have worries once they start to get to retirement,” John explained.
The Social Security strategy
Delaying retirement can actually work in your favor when it comes to Social Security benefits. While you can start claiming at 62, waiting until your full retirement age, 67 for those born in 1960 or later, gets you the full benefit amount. Hold off until 70, and you’ll see a 24% boost to your monthly checks.
This strategy becomes even more valuable when you consider that Social Security benefits come with built-in inflation protection through annual cost-of-living adjustments, something your 401(k) doesn’t offer.
Building a bridge to retirement
If you’re among those reconsidering your retirement timeline, you are not powerless. Several strategies can help bridge the gap between where you are and where you need to be.
First, take advantage of catch-up contributions if you’re 50 or older. You can contribute an extra $7,500 to your 401(k) and an additional $1,000 to your IRA annually, as outlined by the IRS. Even small, consistent contributions can make a difference over time.
Consider working part-time in retirement rather than fully stopping work. This phased approach can help your savings last longer while keeping you engaged and providing additional income. Many employers now offer flexible arrangements for experienced workers who want to scale back gradually.
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Protecting what you’ve built
While you can’t control market volatility or inflation, you can take steps to safeguard your retirement savings. Diversifying your investments becomes crucial as you approach retirement, potentially shifting some assets to more conservative options that can weather economic storms.
Gold has historically been a reliable investment for protecting your savings. Open a gold IRA to help shield your savings from inflation, market swings, and economic uncertainty.
Consider supplemental insurance options, such as long-term care coverage, which can help prevent a health crisis from derailing your plans. Healthcare costs remain one of the biggest wildcards in retirement planning, so understanding your options before you need them matters.
Making peace with a new timeline
Postponing retirement doesn’t mean giving up on your dreams; it might actually help you achieve them more securely. Those extra working years can significantly boost your savings, especially if you’re aggressive about contributions once other expenses like mortgages or college tuition wind down.
The key is staying flexible and realistic about your timeline while taking concrete steps to improve your financial position. Whether you retire at 62 or 72, the goal remains the same: creating a retirement you can enjoy without constantly worrying about money.
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