Dear Kim,
I’m 63 and thinking about cutting back to part-time work in the next year or two instead of retiring all at once. Is that a smart move financially, or does it create more complications than it’s worth?
Sincerely,
Potential Part Timer
Dear Part Timer,
The answer begins with where you are financially now.
Are you earning enough to pay your bills with a cushion at the end of the month? When you go part time, will you need to draw from your savings to make ends meet? How much each month, and what is the balance in your retirement/savings accounts?
If your retirement savings isn’t where you want it to be quite yet, you may want to hold off until you get the balance you believe you need. A financial planner can help you determine what that number is based on your lifestyle and expenses. So, there are several things to consider before making that decision.
If you can easily pay your bills on less income, your retirement accounts are where you need them to be, and you have enough savings to give you a buffer, then enjoy yourself! I love being able to tell clients that they can work as long as they are enjoying themselves, but they have enough savings to quit whenever they wake up and say, “I don’t want to do this job any longer.” There is a tremendous sense of freedom and peace when you reach that point.
Best of luck,
Kim
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