Let's face it; most people don't expect to retire until their normal retirement date (NRD) -- age 65. In their later years of employment, they make a relatively higher salary; those last few years can be a good time to really increase 401(k) savings. But the reality is that so many employees never make it to their NRD in this economy and are being forced out at age 55, or even lower. What happens if you lose your job to due to downsizing while the job market is dried up? You still need to maintain a certain standard of living until you really want to retire. The number of older workers losing their jobs is growing faster than any other age group-it jumped from 3.2 to 5.2 percent in the past year.

You definitely have to cut spending and look at all of your options, even selling your home, which is difficult in this recession. Layoffs can be especially painful for older, experienced workers and their job loss can diminish their sense of self-worth. It's hard to accept that you are expendable. The hardest hit employees laid off are those between the ages of 55-65 because they lose their health insurance and are uninsured. For instance, if you lose your job at 62, you have three more years before you are eligible for Medicare which means you either apply for COBRA from your previous employer or purchase private health care insurance. Both of these options are very expensive and most people cannot afford them after losing their source of income.

Some suggestions you may want to follow are:

Be Flexible: Economic conditions right now are unprecedented, but companies that are hiring want seasoned personnel-- people who can hit the ground running and need very little training.

File for Unemployment: Do not be embarrassed; you have earned the right to this benefit, just like your right to apply for Social Security or Medicare. This will help you to bridge the financial gap between jobs.

Be Patient: Older workers do find work, and it is often more rewarding-- both intellectually and financially. I can certainly attest to that. After I lost my job and we moved to Florida I was hired to work in our church office here, and I just love it. I feel so fulfilled supporting our church members on a daily basis. At the age of 67, I have enhanced my skills so much by learning new software programs, such as Publisher, which I use to design and publish our Sunday bulletin. I am also designing our new church website. How exciting that project has become as I learn about graphic arts, uploading sermons, and maintaining the church calendar and special events on the site. It truly keeps my mind sharp and tests my patience! And every year I work increases my Social Security benefit--this year I was given a $90 a month increase. So, it pays to keep working even if you take early retirement benefits like I did.

Avoid Early Withdrawals: Try not to take money out of your 401(k) plan or other retirement accounts if at all possible, especially when the stock market is falling. Sit down with a professional who can show you other options and map out a plan for you.

Delay Social Security: Benefits are reduced before your full retirement age, so try not to apply for early retirement benefits from Social Security. You can calculate this at http://www.ssa.gov/planners/calculators.htm

Explore Healthcare Options: This includes COBRA, a union or association group plan, or a high deductible plan that just protects you in the event of a catastrophic illness or accident.

Focus on Your Future: Have hope or you may easily become lost and depressed. Those who succeed look forward with anticipation instead of focusing on what they lost. One door may close, but another one always opens. I can truly say this after experiencing over 4 layoffs in the last 15 years. My employers in two cases filed for bankruptcy, one closed down due to competition from overseas, and another downsized from 1,200 employees to 300. But I am happier now than ever with a great team of employees, terrific benefits, and a church that just purchased over 30 acres and will be breaking ground next February for a 1,000 seat sanctuary. Life is so exciting and fulfilling-- we are growing, not downsizing. Amen!

Related Posts:

Job Losses, the Reality

http://community.careonecredit.com/b/debt_diva/archive/2008/08/06/job-losses-become-more-

 More Women Struggling with Debt in this Recession

Seasons Change, So Do Finances, How are you Adjusting?

Linda Reese

Linda is a contributing writer for the Retired & Loving it blog. Linda is retired, married, and enjoying her retirement in a retirement community in Florida. She shares her experiences with others who are facing retirement or already there with posts on living on a fixed income, budgeting, and healthcare issues. Compensated CareOne Blogger.

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