The Unexpected Reality of Early Retirement
A recent report has revealed that more than half of retirees in the United States have left the workforce earlier than they had planned. This decision, often made under circumstances beyond their control, highlights a growing concern among older adults.
The Retirement Risk Survey, published in May by the Society of Actuaries Research Institute, found that 59% of retirees exited the workforce before they had anticipated. In contrast, only 6% retired later than expected. This data aligns with other studies suggesting that many Americans are retiring earlier than they initially intended.
According to two well-known annual surveys of working and retired Americans—one conducted by the Employee Benefit Research Institute (EBRI) and the other by the Transamerica Center for Retirement Studies—the average retirement age is around 62. However, most workers do not plan to retire at this age.
The EBRI survey indicates that the average worker expects to retire at 65. Meanwhile, the Transamerica study shows that 39% of workers plan to retire after 70, if at all. These findings suggest a significant gap between what people expect and what actually happens.
Health Setbacks as a Major Factor
One of the key reasons cited for early retirement is health-related issues. The Society of Actuaries report found that health setbacks were the most common cause for retirees leaving the workforce prematurely. This could include personal health problems or those affecting family members.
However, the reasons for early retirement vary depending on income levels. The report highlighted stark differences between higher and lower-income retirees.
For individuals with incomes below $35,000, the primary reason for retiring early was “changes in health status.” This typically involved health issues for the worker or someone in their household. Job loss was the second most common factor, both of which are generally out of the individual’s control.
For more affluent workers who retired early, “a lot of the reasons were less negative,” said Timothy Geddes, a managing director at Deloitte Consulting and co-author of the report.
“Some of the high-income retirees reported that they achieved their financial goals, so they stopped working,” he said. “And that’s not in any way negative.”
Low-income retirees, by contrast, were less likely to have a choice about when and how they retired.
“Certainly, those are not people doing it because they want to,” Geddes said of workers who retired for health reasons. “They’re doing it because they have to.”
The Society of Actuaries report drew on interviews of 1,007 pre-retirees and 1,005 retirees in 2024.
Why do workers retire before they had planned?
Retirees who left the workforce earlier than planned cited several factors in the survey. Here are the top five:
- Changes in health status, 31%
- Job dissatisfaction, 25%
- Job loss, 20%
- Change in family situation, 19%
- Achieved retirement savings goal earlier than expected, 16%
The findings underscore a common misconception about retirement: that we get to choose when and how we leave the workforce.
Higher-income Americans are more likely to have a say in their retirement, even if they retire early, a finding echoed in both the Society of Actuaries report and the EBRI study.
“The higher-income people are more likely to do it because it’s their choice, whereas the lower-income people are more likely to have their health or a change at the company being the cause,” said Craig Copeland, director of wealth benefits research at EBRI. “It’s out of their control.”
In the 2026 EBRI/Greenwald Retirement Confidence Survey, 46% of retirees said they left the workforce earlier than planned. Only 6% retired later than expected.
Surprisingly, most retirees seem to be doing OK
The good news, reflected in both the EBRI and Society of Actuaries studies, is that most retirees seem to be financially comfortable.
In the Society of Actuaries survey, only 19% of retirees said they were worse off financially than they had expected when they were working.
In the EBRI survey, only 24% of retirees described their standard of living as fair or poor.
Those data points suggest many retirees are making do on Social Security income and a modest amount of savings.
In the 65-74 age group, the typical family with a retirement account has about $200,000 saved, according to the latest federal Survey of Consumer Finances in 2022. Only about half of those households have retirement accounts at all.
By contrast, financial planners often recommend workers plan to save $1 million or more toward retirement.
“There’s a great deal of making adjustments and learning to live with what you have,” Copeland said.
This article originally appeared on USA TODAY: Most of us retire earlier than planned. Here are the top reasons
Income Levels Influence Retirement Decisions
In contrast, higher-income retirees—those with incomes over $75,000—had different motivations for retiring early. The main reason cited was job dissatisfaction. The second most common reason was achieving their retirement savings goals earlier than expected. Both of these factors are largely within the individual’s control.
This distinction underscores how financial stability can influence retirement decisions. For those with limited resources, external factors such as health and employment play a more significant role. Meanwhile, those with greater financial security may choose to retire based on personal preferences and financial planning.
These findings highlight the complex interplay between personal choices, economic conditions, and unexpected life events when it comes to retirement. As more Americans face the reality of retiring earlier than planned, understanding these factors becomes increasingly important for both individuals and policymakers.
