Adjusting retirement planning for older clients who lose their jobs

We have a client who is very specialized in what she does who lost her job. Great news for her: She was a good saver. But at the same time, we had her on a plan to retire in five years. Even though she has a little over a year and a half worth of income in her emergency fund, she’s extremely nervous that she’s not going to find new employment and will have to retire. We’re seeing those types of challenges: Clients who are a little bit older are trying to figure out how to retire earlier than when they anticipated. 

We’ve been able to sit down with them and go over what their current plan is and how we can make some adjustments so they feel comfortable about their retirement. Instead of saying that their retirement income is going to be $10,000 a month, what we projected in five years, we’ve been able to sit down and go through the numbers again. And for some of them, the difference might only be $500, maybe $1,000, where now they’re going to get $9,000 a month versus the $10,000 they were thinking about. 

Once they see what their retirement number is, it alleviates a lot of those stresses that they’ve had by losing their job or deciding, “You know what? I can retire. I can go do something else.” The bad news is that some of those who are in our public school systems need to have 20 years in before they can benefit from a full retirement package. Some have only 15 or 16 years in, so having those difficult conversations with them and telling them, “Yeah, unfortunately you’re not going to get your full retirement” has been a challenge; however, our clients are willing to take those reduced numbers because they feel that they can then go and do something different. 

Their passion may be teaching but at the same time, they’re saying, “If I can’t teach anymore, if I can’t be in the classroom with the kids, I’m OK with that. I’ll go find a different job, or I’ll figure out how to teach virtually.” They’re being thrown into the deep end for retirement that they weren’t expecting. Some of my clients knew before this ever happened, the exact day, the exact time that they were going to retire. Now all of a sudden that day and time might’ve changed, which has caused some stress on our end because we have to redo their entire programs. We never want to let our clients down, obviously, but sometimes it’s a big challenge. And some of them, they’re big numbers. 

I don’t like to have that conversation because it feels like I let them down. But then I remember that, wait a second, I didn’t let them down. We were on track to get to where we were; it’s circumstances that let them down. Once they realize what those circumstances are, it’s amazing that most of them are willing to accept it and say, “That’s OK. My life, my family, my well-being are so much more important to me than that extra monthly income that I should have expected.” 

Brad J. Myers is an 18-year MDRT member from South Jordan, Utah. Hear more in the MDRT Podcast: