One cold autumn day, the Scottish poet Robert Burns was ploughing a field when he churned up the burrow of a field mouse. Burns was sorry to have destroyed its cozy home and reflecting on the event composed “To a Mouse on Turning Up in Her Nest With the Plough, November, 1785.”1
Even if you’ve never heard of this poem, you’re probably familiar with its most famous line: “The best laid schemes of mice and men go oft awry.” The piece is a meditation on the fact that people often share a similar fate to the poor mouse. Just when they think they have everything squared away for a secure future, along comes an unexpected event that upends all their careful planning.
When it comes to planning for your retirement, one such event can be the loss of your job late in your career. Not only is it more difficult for someone over 50 to get back into the workforce, but their income stream is interrupted during their peak earning years. And this can have a significant effect on their ability to save for retirement—especially if they were hoping to do a lot of savings “catching up” in their last few years.
You probably know someone this has happened to. In fact, a recent study by the Transamerica Center for Retirement Studies found that a majority of people (58%) are not able to work as long as they would like.2 On average, people retire around age 62, several years short of the traditional age of 65.
The study found that being laid off was a significant reason for no longer being able to work (43%). But it wasn’t the top issue. Health-related reasons at 46% were cited as the number one factor in being forced into early retirement. Family issues were a distant third.
Even more sobering than the news that so many people are unable to keep working is the financial state of these early retirees. Only about one in five (21%) reported being financially stable.
The poor field mouse couldn’t imagine anything as devastating as Robert Burns’ plough. But careful planning for retirement can help you acknowledge and strategize for risks such as having to leave work before you want to.
First, you can take seriously any ongoing health issues that might one day prevent you from working. Second, you can become more intentional about your career. Instead of sitting back and hoping for the best, you can actively pursue the plans and connections required to transition to another role, if necessary.
Finally, talk with your trusted advisor. He or she can help you explore alternative paths to take should your career end before you are ready.
The future is stubbornly unknowable. However, you can take steps to help make sure your retirement plan can weather unforeseen events by including flexibility, as well as cultivating your own attitude of resilience. Your retirement may not turn out exactly as you’ve imagined it. But whatever happens, you can plan to face it with peace of mind.
Sources:
1. https://en.wikipedia.org/wiki/To_a_Mouse
2. https://finance.yahoo.com/news/58-americans-careers-cut-short-194938202.html
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