As the pandemic-era combination of stimulus payments, soaring home values, and stock-market gains continue to rise, more and more Americans are retiring early and delaying receiving their Social Security benefits — a trend that’s becoming more common as a result.
The COVID-19 economy has created “some of the strongest incentives to retire in modern history,” according to a Washington Post analysis of government data.
Some retirees delay taking their Social Security benefits in order to receive larger monthly payments.
After examining Labor Department figures through September, a WaPo investigation found a 5% decrease in the number of people filing for Social Security benefits over the same time last year.
Securing a pension is now more difficult than ever before, according to the Social Security Administration.
As a result, the number of workers aged 65 to 69 retiring each year increased by 5 percent over the same period.
About 3 million American retirees benefited from the pandemic, which is about twice as many as would have been expected prior to the pandemic’s outbreak.
This shift is being driven by three factors: generous federal stimulus and unemployment insurance payments; larger retirement funds thanks to stock market gains and soaring home values, as well as COVID-related restrictions that have forced seniors to apply for Social Security benefits online rather than in the field offices.
Economist Lauren Hersch Nicholas predicted that “in economic downturns, we see an increased reliance on Social Security programs, and thought that’s what would be coming with the pandemic,” in an interview with the Washington Post. “The claiming numbers don’t support that at all,” he says.
With the COVID-19 pandemic causing both economic and health-related uncertainty, more people are choosing to retire, especially women.
Economic expert Courtney Coile at Wellesley University told The Washington Post: “Health worries unique to this recession could play a role, especially because older employees are less likely to be able to telework” than younger ones.
It’s possible for Americans who have large savings to retire early, but it’s not so simple for those who are still struggling to make ends meet.
A previous report from GOBankingRates found that only 36% of non-retired Americans believe they have enough retirement savings to cover their post-retirement financial needs. A third of those who had planned to retire say the pandemic will push that date back.