Retirement Planning for the Unexpected

By Brent Meyer — SafeMoney.com Founder & Editor Reviewed by Licensed Financial Professionals  |  SafeMoney.com — Trusted Since 2011  |  Updated Regularly Quick Answer: Prepare for retirement's surprises with safe money alternatives. Learn how to secure your future today! Explore options at SafeMoney.com. Scottish poet Robert Burns famously wrote, “The best-laid plans of mice and men often go awry.” No doubt you likely have a plan for your retirement , even if you might not have a formal written financial plan. You may know when you want to retire and what you’ll be doing afterwards with your newfound freedom. You may even have a roadmap to get you there. Now imagine that a big hand reaches down from the sky, crumples up your roadmap, and tosses it aside. But wait, you protest! Too late, your circumstances have changed forever. While that sounds like a stretch, just being caught off-guard with your retirement plan would be less than pleasant, huh? This is essentially what happened to half of the retirees in The Retirement Preparedness Study from Prudential Retirement. When surveyed, 51 percent said they retired earlier than planned. Sounds good, right? A chance to get to that retirement wish list sooner? Not exactly. Only 23% retired earlier than planned because they wanted to, either because they had enough money to retire, wanted to retire, or were simply tired of working. Everyone else was dealt an unplanned event, either partially or fully out of their control:  46 percent retired earlier than expected due to health problems 30 percent were laid off from their jobs or offered an incentive package to retire early 11 percent were forced to leave work to care for a loved one For that 51 percent, their “best-laid plans” went awry, forcing them to adapt to a future they hadn’t foreseen. Why Retiring Even a Few Years Earlier Than Expected Matters Generally, people reach the pinnacle of their profession and their earning power during the few years before they retire. Prudential points out that losing those earning years can have a significant impact. They are the times that contribute to the calculations of a personal earnings history for Social Security benefits, not to mention when you may contribute more money toward retirement accounts. If you have a defined-benefit pension, these earning years also play into calculating your retirement income level for your pension payouts. Plus, the potential loss of employer-sponsored health