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Navigating an early and unexpected retirement during COVID-19

Due to the COVID-19 pandemic, there are many reasons why people may consider retiring sooner than they planned. This could mean claiming your Social Security or pension benefits or tapping into savings earlier than planned.

Below are some resources to help you understand and weigh your options when considering an unexpected retirement.

Claiming Social Security

The age when you start collecting Social Security can make a big difference in the amount you’ll get each month. For example, you can claim your Social Security retirement benefits as early as age 62, but the amount you receive each month could be 30 percent less than what you’ll receive at your full retirement age or up to 70 percent of what you’re eligible to get at age 70.

If you need to start collecting your benefit early because of your financial situation, here are a few options that can help you maximize your benefit if your plans or employment situation changes.

Withdrawing your application

If you’re able to secure a job or another income source, you have a one-time option to withdraw your application for Social Security benefits as long as it’s within 12 months of when you applied.

Keep in mind, however, that this can be complicated and possibly expensive. If you already started receiving benefits, you’ll need to repay what you and your family received – and all at once. Your spouse and any other beneficiaries also must provide written consent to the withdrawal.

Suspending your benefits

If you’ve already reached your full retirement age and you’re financially able to, you can also ask the Social Security Administration to suspend your payments , which will allow your monthly benefit to grow until age 70.

Use our Social Security planning tool to learn more about how your retirement age impacts your benefits and other factors to consider.

Collecting your pension

If you have an employer-provided pension, and a choice between a monthly payment or lump-sum payout, it’s important to think carefully about the tradeoffs of your options and to always ensure that your payout amount is properly calculated.

Weigh your payout options

While pension payments are traditionally paid out monthly, employers are also increasingly offering payments in one lump sum . While this option may provide more flexibility, it also shifts the responsibility to you to manage and protect the entirety of your retirement money.

Choosing a monthly payment can offer steady and protected income. However, if you’re considering a lump sum payment, consider a number of important questions around whether you’re at risk of outliving your money or losing or reducing your benefit due to risky investments or fraud.

Detecting calculation errors

Errors can occur when pension administrators calculate your payout amount. Missing commissions, overtime or bonuses, and outdated personal information are among common errors that could impact the total pension amount . As a result, it’s important to review your pension plan and to work with your administrator if there’s incorrect information in your employment record.

If you have questions or concerns about your pension, federally-funded and certified pension counselors can provide free advice . Also, use our comprehensive pension guide to make sure you get the most out of this important financial benefit.

Withdrawing from your 401(k)s and IRAs

If you have access to an employer-provided and tax-deferred retirement plan, like a 401(k) or a traditional Individual Retirement Account (IRA), you may be considering a withdrawal from these accounts to supplement your income.

In general, you can begin withdrawing money from your plan, without penalty, after the age of 59½. However, any withdrawals before this will result in having to pay taxes because this money is considered income. Your withdrawals could also place you in a higher income tax bracket and may affect your eligibility for other benefits and tax credits.

Finding your money from an old pension or 401(k)

If you worked for multiple employers during your career, you may be one of the millions of people who have left some money behind in retirement accounts and unclaimed pensions. If you’re unsure, contact your past employer(s) and ask for the plan administrator information to see whether this is a possibility.

If your employer or administrator are out of business, you can get help identifying whether or not you have an existing retirement account by contacting the Employee Benefits Security Administration . Similarly, the Pension Benefit Guaranty Corporation , which guarantees many large employer pensions, may be able to help you locate an old pension.

Managing expenses

When considering retirement, it’s important to factor in your expenses. Here are a few to take into consideration as well as resources that may offer support.


Housing may likely be your largest expense in retirement. Utility expenses increase as you spend more time at home, and taxes and other home maintenance costs are a concern for many older homeowners.

If you’re among the millions of homeowners carrying a mortgage into retirement, there may be a number of options that can help you reduce your monthly costs, including refinancing, loan modifications, and repayment plans. Forbearance may be also available if you’re unable to make your monthly payments. It’s important to contact your mortgage servicer to learn what options are available to you.

If you're concerned about how to pay your mortgage or rent during the current pandemic, we have information on what to do now, and what your options are for mortgage and rental relief. Some states and localities also offer relief on property tax bills and utilities that can lower housing costs. The U.S. Department of Housing and Urban Development also provides a list of approved housing counseling agencies in your area that can provide free advice on your housing situation.

Health care and other expenses

Finally, you may also be eligible for benefits and discounts that could reduce your regular expenses, especially on health care costs. These benefits are not only for low-income adults; many are based on age or the type of income you receive. Find out if you’re eligible for benefits programs available in your area .

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