5 Signs You Shouldn't Retire in 2026

You decided a long time ago that 2026 would be the year you retired. It seemed to make sense at the time, but now that it's almost here, you're uncertain. You don't want to make the wrong decision and find yourself without purpose or without the money to cover your basic living expenses.

It's natural to hesitate when you're preparing for a major transition. You may just need a quick review of your financial plan to regain confidence. But if any of the following five signs apply to you, that could be proof you're not actually ready to leave the workforce quite yet.

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1. You think you'll rely heavily on Social Security

Social Security will be there to cover some of your costs in retirement, whether you apply tomorrow or in 10 years. But it probably won't be enough to cover all of your expenses.

Social Security was only intended to replace about 40% of pre-retirement income for average workers. Many people see their annual expenses decrease slightly once they retire, but not significantly. So you'll need other income sources to supplement it. This could be personal savings or a job. If you don't have anything else to fall back on, consider waiting to retire until you've had time to formulate a strategy and save for the future.

2. You have a lot of high-interest debt

Even those with substantial personal savings can find their budget derailed by high-interest debt, such as credit card debt. If you're making only the minimum payments, you may find that your balance grows rather than decreases over time.

Work toward paying this debt off before you enter retirement. You could do this with a balance transfer card or a personal loan. It may take a few months or maybe even a few years, but it'll give you one fewer expense to worry about in retirement.

3. You have no idea how you'll pay for healthcare

Once you're 65, Medicare will likely form the backbone of your retirement healthcare plan. However, if you retire sooner than this, you won't be eligible for Medicare. Ensure you have other health insurance coverage in place before retiring. Otherwise, you run the risk that a single emergency could quickly drain your savings.

If you're eligible for Medicare, you won't have this issue, but you might be surprised by some of the gaps in Original Medicare's coverage. You may need to supplement this with additional policies, such as a Part D plan for prescription drug coverage. Have a strategy in place before you retire and lose access to health insurance through your employer.

4. You don't have a clear plan for how to make your savings last

Retiring comfortably requires more than just financial resources. You also need a withdrawal strategy that will help you stretch your savings over the rest of your life. This could be 30 years or more for some people.

There are different ways to approach this. One of the most popular is the 4% rule. This is where you withdraw 4% of your savings in the first year of retirement and adjust this amount annually thereafter for inflation. It's supposed to help your savings last at least 30 years.

Explore a few options and figure out what makes the most sense for you. Keep in mind that withdrawing more in a given year also likely means paying more in taxes, unless the money comes from a Roth account.

5. You're worried you'll miss your job or be bored in retirement

Retirement can be freeing for some, but for others, it can make them feel as if they've lost their purpose in life. If you're worried that you'll get bored or that you won't have enough opportunities to socialize with others in retirement, you may need a new plan. Rather than retiring, you might consider dropping your hours or switching to a job that feels more like fun to you than work.

It's fine to give true retirement a trial run to see what you think first. However, have a backup plan in place in case it doesn't turn out as expected. If you're unsure what that looks like, consider delaying retirement until you figure it out.

You may not want to postpone your retirement date, but it's important to keep the long term in mind. The decisions you make today could have far-reaching consequences, so you want to make sure you've prepared yourself as best as you can before leaving the workforce.

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