January 15, 2022

I retired at 50, went back to work at 53, and then a medical issue left me jobless: ‘There’s no such thing as a safe amount of [retirement] money’

[MarketWatch, iStock Photo]

Dear MarketWatch, 

I had always said I was going to retire when I was 50. I had worked and saved since I was 16. Retiring without Medicare and Social Security is a scary thing. I wound up retiring then going back to work. At 53, I took a part-time job with a decent salary for the hours but I was sooooo bored. And then life rang my bell. 

I had major medical problems. So major that when I was able to return to work they let me go because they didn’t think I could keep up with the workflow. They were probably right. Nobody else felt comfortable enough with my health issues to hire me. I applied for disability but was denied. I appealed and got my rejection to the appeal while I was in ICU. I appealed again and I was denied because they didn’t think anything changed from my original application.

Everybody needs to know there’s no such thing as a safe amount of money set aside for retirement. Life happens and in the blink of an eye your whole life and everything you worked for can be gone. 

Dear reader, 

I normally only feature letters with questions for this column, but your note was just so important for other readers that I had to respond — and let others see what you’ve shared. 

I’m so very sorry that you experienced this. Wanting to retire early isn’t inherently wrong — so many people wish to do it, especially after decades of working. But without the proper planning, it could lead to despair, especially if an emergency occurs.

“Retiring early is a dream for many people,” said Landon Tan, a certified financial planner. “But those years of not working diminish your chance of a successful retirement more than almost any other metric we toggle when making financial plans.” 

Retiring early means there are more years you need to be able to financially cover, and that requires money — a lot of it. When planning to retire early, those extra years need to be considered — at the forefront of retirement, but also in the back end if you live longer than anticipated. 

“Today’s retirees are expecting their accumulated assets to work for them for 10-20 years longer than before,” said Glenn Downing, a certified financial planner and founder of CameronDowning. “Centenarians are no longer uncommon. For that to happen successfully, there needs to be more assets — simple as that.” Anyone should prepare to live longer than expected so their money does not outlast them, which can feel daunting. 

Those missing years may also affect your Social Security benefits, which so many elderly Americans rely on for most of their retirement income. People retiring early should have a clear picture of what to expect from Social Security in the future, and how their plans may impact those expectations.  

Leaving the workforce also means possibly losing out on participating in a group health plan, and I think we can say with certainty the pandemic has shown just how crucial health insurance can be in dire times. 

You’re absolutely right: Retiring before Medicare is scary. Healthcare is expensive even without an emergency. Not everyone considers this expense when they’re dreaming about calling it quits in their 50s, but if they don’t have proper insurance lined up when they retire they could be blowing through their retirement budget quickly — or putting themselves in a very dangerous situation. Those years can feel long when Medicare eligibility only begins at age 65 for most Americans. And it also doesn’t take into consideration long-term care, which is an entirely other expense. Think nursing homes, home health aides and necessary medical equipment for daily activities.  

Knowing how much is enough to have saved for retirement is very difficult. There is no such thing as one “safe” number before you retire, but there are a few guidelines one can follow to find security in old age. 

By Alessandra Malito

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