One in three Americans feel less confident in their retirement plan than a year ago, and nearly half of pre-retirees say they expect to retire later than planned.
That's according to a survey from CNO Financial Group.
Factors ranging from inflation to healthcare costs are part of the reason, but longevity, market volatility and the possibility of outliving savings is making it increasingly difficult for many Americans to feel they're prepared enough for retirement.
For those approaching retirement, feeling secure enough to stop working can be difficult to define, especially during periods of economic uncertainty. Even workers who have spent decades saving consistently might still not feel fully prepared for retirement.
This uncertainty is largely tied to longer life expectancies. Many people fear their retirement savings won't be enough to stretch across several decades, especially when factoring in inflation, increasing healthcare costs or long-term care.
As a result, some pre-retirees continue to increase their savings goal, even when they've surpassed their original figures.
Sometimes it makes sense to delay retirement
There are situations in which delaying retirement makes sense. Instead of claiming Social Security benefits as soon as you become eligible at 62, waiting to claim can increase your check by around 8% per year up until age 70.
In addition to earning consistent income, working longer than expected also gives your 401(k) or IRAs additional time to grow before required minimum distributions (RMDs) begin.
However, there's a difference between postponing retirement strategically and delaying because of uncertainty.
Waiting too long to retire can bring its own set of risks. As a wealth management specialist, I once worked with an older couple who were both healthy. Over time, they began experiencing physical setbacks that limited their ability to participate in many of the activities they'd planned to in retirement.
By the time they finally felt comfortable enough to retire, their vision for how that time would be spent had dramatically changed.
Emotional changes and retirement
Retirement also comes with emotional changes that aren't discussed as much. After decades of working around a structured schedule, having complete control of your time can be a difficult adjustment.
For many of us, work provides routine, stability, social interaction and a sense of purpose that can be hard to replace as a retiree. As a result, some retirees choose to re-enter the workforce.
I once worked with a retired physician who took a position at a Lowe's home improvement store simply to stay active, interact with people and maintain a sense of purpose.
Although financial security is important, retirement will always involve some level of uncertainty. Deciding when the right time to stop working is more than just reaching a specific savings number.
Quality of life, physical and mental health and emotional preparedness must all be considered.
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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.
