McKinsey & Co. said its study found that f our out of 10 retired workers left their jobs sooner than they had planned, usually because of health problems or the loss of employment, according to a Los Angeles Times report.
The survey also found that 45% of people who are currently employed planned to keep working past age 65. However, among the retirees polled, only 13% said they had done so, the Times said.
The reality “is quite sobering,” commented David Hunt, a senior partner at McKinsey, in the news report. “Our research clearly shows that many people – and more than a few public policymakers – who are betting on simply working longer to compensate for a lack of current savings are setting themselves up for a rude awakening and a significantly poorer standard of living in retirement than they had expected.”
Among those who retired earlier than they expected, 47% cited health reasons and 44% pointed to job loss. The remaining 9% said they had to care for an ailing family member.
Wealth also had a big influence in how people’s jobs come to an end. Workers with less than $50,000 in assets were most likely to be forced out of their careers due to health problems, according to the McKinsey study. Those who had more than $1 million pointed to job loss as the greatest reason for retiring.
The oldest members of the vast baby boom generation who turned 60 in January often cited the need to boost their retirement savings as a reason to keep working, Hunt noted.
“Many of the boomers we interviewed, especially those in their early 50s, believe that they will be able to afford retirement by continuing to work – and often put off the sacrifice of saving today with this in mind,” he told the Times.
The McKinsey survey included retirees and pre-retirees and was conducted in March and April among people 40 to 75 years old.