These are unprecedented times. You don't plan for a pandemic like this unless you are an end-of-days prepper and live in an underground bunker.
Given the fact that the economy is in a state that we could never have imagined a few short months ago, it is no wonder that people nearing retirement age are trying to work out what the future holds. Since the coronavirus hit, 54 percent of adults surveyed in the United States say they’d like to continue working in retirement. 40 percent of American adults are worried that they won’t ever be able to retire.
Some Boomers are trying to access funds quickly to attempt to stave off the effect coronavirus has had on cash flow and investments. Applications for home equity conversion mortgages are up by 50 percent in the first quarter compared to the same period in 2019. A home equity conversion mortgage is the most common type of reverse mortgage that is insured by the Federal Housing Administration. The number of people applying shot up by 15 percent in March alone.
Replacing lost income is essential for paying bills in the short-term and saving over time. If you are hit hard by the coronavirus, it might take longer to build up your savings so that you can retire, especially if those savings are depleted by dipping in to survive this slow period.
If you continue to work beyond retirement age, then you may just be in a stronger position down the line. Once you’ve reached 66 years old, if you are still working, you can choose to contact the Social Security Administration and ask them to suspend your payments until you turn 70. When you reach 70, your benefits automatically be reinstated, and you’ll start getting checks in the mail after your birthday. What a great gift.
By delaying being paid, your monthly benefit checks after the age of 70 could increase by 8 percent. This is a pretty big deal given the fact that 40 percent of Americans who are above the age of 60 and are not working rely completely on their Social Security check for their income and survival.
The annual median Social Security benefit is around $17,000. If you were to add 8 percent to that it’s an extra $1360 a year which is more than the stimulus check of $1,200 that the government kindly sent out.
Taking charge of your destiny is the way to get through this. Coronavirus won’t be the end. If anything, it is a new beginning.
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