I’m a CFP: 5 Money Pressures Forcing Boomers To Rethink Retirement
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Jordan Rosenfeld
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Molly Sullivan
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While baby boomers should be entering retirement or imminently poised to, as many as 30% of them are considering delaying retirement due to financial concerns.
Certified financial planners explained the key money pressures that are forcing boomers to stave off retiring and offered some solutions.
Inflated Expenses
Rising healthcare costs, housing and everyday essentials like groceries are stretching budgets due to inflation, according to Christopher Stroup, a CFP and the owner of Silicon Beach Financial.
“Add in travel, support for adult children or helping aging parents, and retirement timelines shift,” he said.
Many boomers underestimate how inflation compounds their fixed costs, which makes careful cash flow tracking and proactive planning essential to avoid dipping into savings too quickly, he stressed.
One strategy is to increase any disposable income that is left each month to Roth IRAs and other tax-favored investments, according to Steven Conners, founder and president of Conners Wealth Management.
“If it is more tax-friendly when you start taking retirement income, you will need to save less. But this doesn’t equate to all taxable retirement funds,” Conners said.
Debt Feels More Expensive
Inflation also affects the costs of borrowing, which means “debt feels heavier, while inflation erodes purchasing power,” Stroup said.
Boomers should revisit budgets annually, prioritize fixed essentials and stress-test plans for rising costs. “Allocating more toward cash reserves and fixed-income investments helps preserve flexibility, while intentionally trimming discretionary spending gives retirees more confidence their money will last,” Stroup said.
Additionally, Conners urged boomers to pay down high-interest debt like credit cards first because “it’s a guaranteed return.” For mortgages or HELOCs, he recommended comparing interest rates with potential investment returns.
Healthcare Expenses
Healthcare costs continue to be challenging for boomers. While lower drug cost caps and more predictable out-of-pocket limits are providing relief, rising Part B premiums and long-term care expenses still stress boomer budgets, Stroup said.
A good rule of thumb is to plan for healthcare to consume 15% to 20% of retirement spending, Stroup said, though it varies by health status and geography.
“Medicare premiums, supplemental policies and out-of-pocket costs add up quickly. Building a dedicated healthcare bucket or health savings account (if eligible) reduces the risk of medical expenses derailing retirement.”
Housing Costs
Housing costs can eat up a huge chunk of a boomer’s budget, making retirement less likely. Thus, boomers may want to downsize when housing costs exceed 30% of retirement income or when maintenance feels overwhelming, Stroup urged.
Any boomers with high interest mortgages should keep an eye on 10-year U.S. Treasuries, Conners added. “If the 10-year Treasury yield were to come down in yield, it will lower mortgage rates, should it prove sustainable.”
Economic Instability
These are shaky economic times, from tariff-induced price hikes to inflation and concerns about a slowing job market. Stroup pointed out, “A downturn here can permanently dent savings.” Thus, boomers should hold two to three years of living expenses in cash or short-term bonds, then balance equities for growth with safer assets for stability.
“Flexible withdrawals like reducing spending in down markets helps protect portfolios from unnecessary drawdowns.”
Conners recommended boomers consider a fixed-indexed annuity. “Many fixed indexed annuities have no fees and protect against market downturns,” he said.
For Boomers Who Feel Behind, Follow These 3 Steps
For boomers who feel behind or not quite ready to retire, Stroup recommended taking these three immediate steps:
- Audit spending: Identify where money leaks are happening.
- Restructure debt: Refinance or pay down high-interest balances.
- Boost savings rate: Direct windfalls, bonuses or side income into retirement accounts.
Conners added that instead of delaying retirement altogether, boomers can consider working part time.
Either way, quick, disciplined moves create momentum, reduce stress and help shift from reactive to proactive financial decision-making.
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