Vanguard just issued a crucial warning for future retirees — here’s why ‘retirement is changing’ and how to prepare

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When you think of a traditional retirement, you may picture an elderly person blowing out the candles on a cake, receiving a gold watch as a departing gift, and heading off to the golf course.

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That's not what retirement looks like for many people, though, and it's not what an increasing number of people who will be retired in the future want.

"Retirement: A New Era – Are You Ready?" focuses on the evolving attitude towards retirement.

Although it was authored by one of the company's European executives and was based on a survey of British savers and investors aged 50 to 70, many American retirees will find it applicable.

What's the big change Vanguard is referring to? Retirees are no longer looking to simply stop working abruptly. They're instead seeking to transition into retirement gradually, driven by a mix of financial and social motivations.

Regrettably, what many people long for doesn't always become a reality.

People planning to retire in the future should be prepared for the possibility that their ideal retirement plan may not work out.

There is growing expectation among workers that retirement will be a more prolonged transition.

Vanguard said that the majority of future retirees do not plan to simply stop working on a specific date. In fact, only 24% of respondents believed in adopting a hard-stop approach to retirement, working one day and resting the next.

Most either plan to gradually cut back on hours at their current job (27%), "mostly" stop working on a specific date (21%), or look for a new job (14%). The reasons they gave for not retiring were not feeling ready to fully retire, wanting to supplement their income, and social reasons.

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These plans for part-time work could make all the difference in how life looks tomorrow for seniors. However, it's worth noting that counting on this scenario might lead to financial complications for you.

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Retirees need to be ready in case a gradual retirement isn't the experience they end up with

Vanguard wants to issue a warning for those planning a gradual retirement - it's not always going to happen as planned.

Approximately 19% of American adults 65 and older were employed, either full-time or part-time, in 2022.

It is really crucial to prepare for the possibility that you may not be able to retire as planned. To guarantee that you're prepared:

• Save enough money to support yourself by the traditional retirement age of 62, even if you're planning to retire later
• When deciding if a gradual retirement is feasible, take into account your current health and job skills.
• Focus on finding an employer who prioritizes age and values experience equally to youth, typically one with many older staff members on board.
• Take good care of your health through regular exercise and preventative measures to increase the likelihood that you'll be in good health and be able to transition smoothly into retirement.
• Set realistic expectations for your retirement, which may mean that moving to age 70 and still working is unlikely.

You don't have to retire like you may have thought – you can work towards a gradual and desirable retirement. Nevertheless, you should be prepared for any unexpected situation and proactively save for your future, especially if you have the possibility of retiring at a younger age.

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This article offers information only, and you shouldn't consider it as advice. It is provided on an as-is basis.