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The Differences Facing Pre-Retirees Today

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Lou: Walt, as you know, over 10,000 people are turning age 65 every day in this country. What are the biggest differences that you see among pre-retirees? The biggest differences in the situations that they have to deal with? As opposed to maybe over the last ten or fifteen years?

Walt: Sure. Well I think there’s a number of situational differences that they’re facing but the two that really stand out to me are first of all is the fact that many pre-retirees today don’t have traditional pension plans and that’s been a trend that is happening over the last decade or more. And in fact, I heard recently where only about 20 percent of workers today have a traditional pension plan. And for many people, that was a safety net as they went into their retirement years and increasingly people aren’t going to have those traditional pension plans so that’s the biggest difference I think. The second big difference that people in previous generations maybe didn’t face was the impact of the economic downturn in the last decade. And the so-called great recession and there were many people who just when they were getting to retire, getting ready to retire, found that nearly half of their retirement nest egg disappeared and that obviously was a big impact on many folks.

Lou: Very scary to most of us.

Walt: Oh absolutely. And when you think about it, you saved all your life and then you’re just about ready to pull the trigger and retire and all of a sudden half of your nest egg is gone. And I think it’s one of the real reasons behind the fact that many people, pre-retirees aren’t planning to retire at a traditional 65 age. They’re planning to continue working if nothing else to hedge their bets in case that happens again.

Lou: Yeah I’ve had many people say to me, I didn’t plan on this.

Walt: Exactly and they don’t know if it’s going to happen again. I think that’s the it’s the uncertainty of their retirement security that’s causing many people to continue to work.

Lou: How has your thinking changed about your situation, your retirement planning changed over the past few years as opposed again to how you thought about it in the last ten or fifteen years?

Walt: Sure. Quite frankly, I don’t think I really thought too much about my retirement. You know when I was working ten to fifteen years ago. I’ve been very fortunate in that I had a traditional pension plan and I guess I always just thought that I would work up until age 65 and retire on that pension plan and any other savings that we may have been fortunate to accumulate. But three years ago, I was faced with an option to take an early retirement. And I did that and it’s been great. It allowed me to do some things that I always wanted to do. But the one thing about it is there was always that uncertainty. You know, were we still going to be okay. Because I still had a somewhat of a run before I hit 65. And there was that uncertainty as to whether or not we were really okay to do that.