Economic Pressures Prompt Most Americans to Postpone Retirement

Survey data from F&G Annuities & Life Inc. indicates that economic challenges and other factors are leading many Americans to delay or exit retirement. The newly released Retirement Reconsidered survey, conducted in May with 2,048 respondents aged 50 and older, reveals that 51% of this group are contemplating reentering the workforce or postponing retirement.

Despite recent economic improvements such as stock market growth and reduced inflation, most pre-retirees report feeling anxious. The survey found that 68% of respondents who have yet to retire have either already delayed their retirement plans or are considering doing so, an increase from 64% last year.

This trend is particularly noticeable among Generation X respondents (ages 50-59), with 71% considering delaying their retirement, up from 65% the previous year. Half of this group indicated that if they returned to work, they would likely choose a different industry.

John Currier, president of F&G, noted that as Gen Xers approach retirement, their concerns are intensifying. He emphasized the importance of having the right financial advice and tools, such as fixed-indexed annuities (FIAs) and registered index-linked annuities (RILAs), to alleviate these worries by offering both potential growth and protection against losses.

Inflation emerged as the most common reason for altering retirement plans, cited by 49% of pre-retirees and 44% of retirees. Chris Blunt, CEO of F&G, commented on the challenging economic environment, stating that Americans are rethinking retirement, which now looks different from previous generations. He believes that proactive financial planning can mitigate some economic risks and help individuals focus on a personalized retirement roadmap.

Economic factors are not the only drivers of this trend. One-third of those delaying retirement or considering it said they do so because they love their work. Among those already retired, 45% would consider returning to work because they enjoy the challenge.

The survey also found that 70% of individuals who have changed or are contemplating changing their retirement plans have sought advice, though spouses were the most common source, with only 16% consulting a professional financial adviser.

Reverse mortgage professionals may also play a role in these decisions. Steve Resch, a Finance of America executive, mentioned that financial planners are increasingly open to reverse mortgages as a way to manage long-term care expenses, which are impacted by inflation. Resch noted that clients are often hesitant to pay for expensive insurance solutions, which can cost $10,000 to $15,000 per year.

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