COVID Forcing People To Retire?

rogernusbaum

Marketwatch had an article that asked Will COVID-19 Force Older Workers To Retire? According to the article this effect occurred during the financial crisis and is starting already, just a few months into the Covid event. This is a topic I write about often, having your hand forced to retire, or otherwise find new work, unexpectedly a few years before you were planning. This outcome is real threat for someone in their 50's because it is hard for someone who is 50 or older to find work but they are far enough from the typical retirement age that it's reasonable to think they would not be financially ready. Obviously it is a threat to someone over 60 too but if you're 62 and planning to retire at 65 then you have a better chance of being ready or readier to retire versus someone who is 52.

This issue resonates with me I think because as I navigate through my 50's, my friends from high school and college who aren't self-employed are vulnerable to having their hand forced in this manner. There is certain sense of security with a regular paycheck but it does create a fragility when something unexpected happens and there are no contingencies in place.

I think the origin for my thinking came from a couple of things in high school. I was aware of the personal finance mistakes my parents had made and getting a job in high school allowed me to build up a little bit of money which I felt gave me optionality even though I didn't know that word yet. I've developed in such a way to create an ever increasing priority on optionality. Being self employed is far from riskless but I think self employed people have more control over the inputs which hopefully gives a better chance of achieving the desired outputs.

The book Multiple Streams of Income (not an affiliate link, just a useful book) also helped me develop here. I first read it 20 years ago when permanent job loss wasn't an age-related threat for me in my mid-30's but it influenced me all the same. I've been transparent in blog posts as I've cultivated interests into potential income streams should I ever need them; being an EMT, doing Incident Management Team work on large fires (I've gotten some training, and I believe this door is open to me but no certainties of course), our Airbnb and my photography (I've sold a few things but not sure this is headed to a real income stream).

Whatever you're interested in and like doing, it's a good bet that some is making money doing those same things. That doesn't ensure you can monetize your hobby but it creates an opportunity to pursue. But start pursuing it now, don't wait for something bad to happen to then start. Ramping a hobby up into an income stream could take years. I cannot envision the scenario where I would lose my job but resting on that laurel makes for very bad planning.

If the financial crisis forced some folks' hands and the Coronapoclypse is doing likewise then it is a reasonable bet that something else will come along down the road that will also force people to retire earlier than they planned on. And that's just top down circumstances, what about the infinite number bottom up scenarios that could come along too? Start now, keep at it and seek to develop new interests. This is a potentially fun way to get the most out of your optionality and resiliency.

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