Too Soon? When a Changing Economy Forces Early Retirement

When times get tough, we all start thinking about how to cope with changes in our employment status, right? Especially these days, with the Coronavirus pandemic forcing sweeping changes across the economic landscape, many individuals are carefully watching their 401K and IRA balances and poring over memos from their employers’ HR offices, looking for any hint that they might be looking at some kind of severance or early retirement offer as the company trims costs. What if your company announces a voluntary or involuntary early retirement or severance program? What would you do?

By the way, this isn’t a new question. Even in the pre-COVID-19 days, more than half of retired persons said they left the workforce earlier than planned, due either to unanticipated job loss or medical reasons. Despite that fact, however, more than 80% of American workers surveyed in an April 2020 study by Allianz Life believed they would be able to retire “on their own terms.” Everyone who is still working hopes they’ll be able to do that, but what if the economy or declining health make that impossible?

Here are some steps you can take to be ready if you have to retire earlier than you planned.

1. Unload your debt.

The number-one enemy of a stable and low-stress retirement is too much debt. Whether you are still paying a mortgage or you have too many credit card balances, creating a strategy for knocking out your debt before you retire is one of the best things you can do for yourself.

2. Get serious about your budget.

This is strongly connected with jettisoning your debt. Figure out what your no-frills monthly budget is, and stick to it as much as you can. Apply any income above that amount to debt reduction, and you’ll soon start to see those debt balances fall — along with the amount of your income you have to dedicate to interest payments.

3. Look ahead.

Especially if you’re still working and in your prime earning years — typical of many people on the “glide path” toward retirement — make sure you have an accurate forecast of what your income and expenses will be after you’re retired. Don’t forget to include the costs of Medicare and necessary supplemental coverage and possible long-term care insurance.

4. Make a plan.

After you’ve got a good picture of your post-retirement needs, establish a strategy with your savings and investments to ensure that you’ll have enough stashed away to meet your anticipated needs. One of the best ways to do this is by working with a certified, professional financial planner who can help you figure out the best way to get from where you are now to where you need to be.


Following these four steps are the best way to prepare for the possibility of an earlier-than-anticipated retirement. Even if your career is forced to an early ending, shedding debt, budgeting, and advance planning will give you the tools you need to reset and refocus.

I specialize in helping individuals thrive during retirement. If you’d like to know more about putting my professional resources to work for you, contact me. To read my informational articles about how to become a thriving retiree, click here.

Stay Safe, Stay Home, Stay Hopeful!

Empyrion Wealth Management (“Empyrion”) is an investment advisor registered with the U.S. Securities and Exchange Commission under the Investment Advisers Act of 1940. Information pertaining to Empyrion’s advisory operations, services and fees is set forth in Empyrion’s current Form ADV Part 2A brochure, copies of which are available upon request at no cost or at The views expressed by the author are the author’s alone and do not necessarily represent the views of Empyrion. The information contained in any third-party resource cited herein is not owned or controlled by Empyrion, and Empyrion does not guarantee the accuracy or reliability of any information that may be found in such resources. Links to any third-party resource are provided as a courtesy for reference only and are not intended to be, and do not act as, an endorsement by Empyrion of the third party or any of its content. The standard information provided in this blog is for general purposes only and should not be construed as, or used as a substitute for, financial, investment or other professional advice. If you have questions regarding your financial situation, you should consult your financial planner or investment advisor.