Some early retirees have second thoughts
— -- When Vic Paganucci of Norwalk, Conn., was given a chance to take early retirement last spring, he jumped at it. He was weary of his two-hour commute to Wall Street and no longer enjoyed his job as an insurance broker.
But now, at 58, he's having second thoughts. In part, it's because he misses the fulfillment a job provides. But increasingly, money is a concern, too.
"I have no problem paying the bills, but the market seems to go down endlessly," he says. "Sometimes I wish I had looked for a job rather than just retiring."
The oldest Baby Boomers are turning 62 this year, making them eligible for Social Security. About half of this year 's group — some 1.6 million — are expected to file for Social Security as soon as they qualify, even though that means receiving reduced benefits for the rest of their lives.
Many older Boomers — including those, like Paganucci, who have yet to turn 62 — say they're willing to accept a smaller payout in exchange for an opportunity to retire while they're still young enough to enjoy it. But recent retirees who had expected to supplement Social Security with their savings have seen their investments decimated by the stock market's nose dive. Their home equity has evaporated. And rising prices for gasoline, airfares and groceries threaten to shred their retirement budgets.
Even well-off retirees have been unnerved by the economic downturn. Austin Frye, a financial planner in Aventura, Fla., says several of his clients who are retired physicians were accustomed to seeing their pre-retirement pay rise at the rate of inflation.
Now, he says, the value of their investments and real estate holdings has fallen, while their cost of living is surging.
To supplement their retirement income, Frye has helped some of his clients find part-time jobs as teachers or expert witnesses.
Otherwise, he says, "They can't give gifts to grandchildren. They can't jump on a plane and visit their children like they used to."
Some older Boomers have postponed plans to retire until the storm blows over. An AARP survey conducted in April found that nearly 20% of workers 55 to 64 plan to delay retirement because of the economy.
Others don't have that option. Jim Bergstrom, 59, of Dent, Minn., retired in September from his job in construction because arthritis made it hard for him to continue working. "Construction is a young man's job," he says.
After retiring, Bergstrom and his wife, Karen, a former secretary for the University of Minnesota, put their house near Minneapolis up for sale and moved to a lake house they bought four years ago. They planned to use the proceeds from the sale of the Minneapolis home to supplement their retirement savings. But after months on the market, the house sold for $30,000 less than the asking price.
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