Retired Unexpectedly? 5 Financial Options When You Weren't Prepared

Retirement isn't always planned, and it sometimes happens well before you turn 65. You may get laid off, have to quit your job to take care of an ailing family member, or leave work for health reasons. Some become so dissatisfied with their career that they walk away, while others leave their job to pursue longtime interests such as travel or starting a business.

Regardless of the reason you retired unexpectedly, there are ways to keep your finances secure even if your retirement savings aren't enough to support an early exit from your job.

5 Ways to Make It Work

Make a budget

With less income, you'll need to create a budget that's realistic for your new lifestyle. First, list your fixed expenses and your discretionary expenses, and then determine your monthly income from pensions, savings, and government benefits. Be prepared for the hard choices your new budget may require, such as no longer providing financial support to children or grandchildren and scaling back on vacations. Mostly importantly, stick to your budget. Without regular income from a full-time job, it's imperative not to overspend.

Get a part-time job

Recent data from the Bureau of Labor Statistics shows that about 40 percent of people age 55 and older were working in retirement in 2014, an 8 percent increase over the year before. The good news for retirees looking for part-time work is that more and more businesses are looking to hire part-time employees, according to a 2015 survey.


A cut in income usually means a cut in lifestyle, and you may have to take a hard look at places where you can downsize. This could be as drastic as moving to a smaller, more affordable house or selling the second family car. You may have to eat out less often and be more careful about purchases. For couples, it's especially important to discuss each partner's spending priorities and make downsizing decisions together.

Capitalize on your hobbies and expertise

Whether you've become an expert in your field through your career or have dedicated years to a hobby, there could be a market for your skills. Jobs in teaching, coaching, or consulting may be a good fit with your expertise, and you also could consider starting a part-time business selling craft items that you make.

Get a reverse mortgage

If you have a longtime investment in a house and are age 62 or older, you may qualify for a reverse mortgage. If you own your house outright or have a small mortgage, a reverse mortgage would allow you to receive money from the equity in the house.

The money can be withdrawn in a lump sum or in monthly increments, which could provide a steady income as long as you stay in your house. The loan typically does not have to be repaid until you sell your house.

Even if you retired unexpectedly before you were financially prepared, drawing on your personal experience and talent along with managing your monthly budget well can make it possible to thrive without your former income.

Find out how much you qualify for.