Friday, March 30, 2012, AM | Leave Comment
Many experts say the U.S. economy is on a definite rebound. Unemployment rate has come down. Many folks, once they hit 62 and can claim reduced Social Security benefits, sometimes quit impulsively, even when they had planned to work longer. I started collecting social security last year when I was 63. I had no choice because I had been out of work for almost 10 years.
However, many folks are deciding to work more, spend less. If you have invested some money, take a good hard look at the allocation of your investments.
Folks of all ages are hurting, of course. But the experts tell us that in theory, the market downturn could work to the advantage of those 45 and younger, with decades to go before retirement.
It’s not surprising that those in their 50s and 60s are the most likely to be hastily rewriting their plans. Here are some suggestions of what to do and what moves to consider.
People in their 50s and 60s, even before this economic hardships to say the least, had planned to work longer. Before it was a choice. Now it is survival. If you get a young boss you hate, suck it up. Don’t quit.
For each month you delay claiming Social Security, up to age 70, you earn a bigger government check adjusted for inflation.
Read why baby boomers will need to work longer, a report published in McKinsey Quarterly. It was written in November of 2008 but it still applies to the present and foreseeable future.
Spend less, Save more
For some Americans if not most, this is going to be the hardest part. The government will tell you to spend, spend, spend. That’s good for the overall economy.
But we must spend with our minds and not with our hearts. We must quit spending on the spur of the moment. Some economists call it impulse buying. We must increase our level of savings so we are better ready in the future.
It’s not only Americans but Britons will have to save more and work longer, warns Bank of England report. The rest of the world is not doing better either. Some are worse than others.
In a Nutshell
Personally, I don’t see anything wrong with spending but spend within reasons. Fulfill your needs first. If people keep on spending like there is no tomorrow, then when they experience hardships, they have to be ready for that. They must not, then, complain.