Early Retirement? 5 Options to Consider

Employment options don’t increase as we get older. Your work position may not be safe, even if you have decades of employment under your belt.

More than 2 million Americans were forced into early retirement recently. And of that number, 55% automatically became financially insecure as a result.

If you have been offered early retirement, here is what you should consider.

Take the hint

If your employer is offering you early retirement, it’s for a reason that probably has nothing to do with your benefit. Your employer may be grooming a younger worker to take over your position.

Or your employer and company may be in dire financial straits,  trying to cut costs, save money, and offer early retirement as a cost-cutting measure. Your company may be insolvent and offering early retirement to its senior employees to stave off bankruptcy or closure.

Think carefully before you accept or reject an early retirement offer. If you reject the initial retirement offer, you may not get a second offer. And the next meeting you have with your supervisor or boss may be about termination.

Consider your options

If you have worked at your job for years or decades try to strategically cash in accumulated goodwill to get some inside dish from sympathetic supervisors, bosses and colleagues.

Based on what you learn, you can buy yourself some time before accepting the offer or finding new work.

For instance, if your employer is grooming a replacement, you could offer to stay on for a few months or a year to help out in that endeavor. You could also offer to stay on at your job as a consultant.

The downside to this strategy is that you may potentially forfeit your early retirement offer and have your salary reduced. Try to negotiate a new, limited position at lower pay as a prerequisite to an early retirement offer if possible.

Reassess your personal finances

Carefully go over your savings, debts, expenses, investments, budget and overall personal finances. Try to calculate how long can you afford to be unemployed before accepting an early retirement offer.

Consider your mindset

What would you do after accepting early retirement? Do you want to sit at home? Would you travel?

Or would you try to reenter the workforce as a middle-aged or elderly person?

Going from a lifetime of work to a full dead stop to retirement can be psychologically taxing and cause depression. Think about what you would do if you accepted early retirement.

Start job searching

If you have been offered early retirement you may be running out of options relative to your continued employment.

Start calling in some favors, reaching out to friends and professionals that you know who work at other companies and looking for new work.

It’s better to have some options and not need them than need them and not have them.