DEFINITION of 'Peri-Retirement'

A term for the period of time leading up to actual retirement. Peri-retirement is marked by the planning phase of retirement, in which an individual determines his or her financial readiness. Individuals in this stage leading up to retirement are most likely to be in their late 30s, 40s or 50s.

BREAKING DOWN 'Peri-Retirement'

Retirement planning is more complicated now. While many employees could once count on company pension plans to cover retirement expenses, most workers aged 35 and older can no longer expect that type of income in retirement. Today, individuals entering the peri-retirement stage of life may have to balance economic and financial hurdles previous generations did not face, including supporting children who have been unable to find jobs and are living at home.

Planning during peri-retirement involves an examination of retirement income, and whether an individual’s current savings rate will be enough to support him or her in the post-job decades. If investors have not saved enough money to date, the years of peri-retirement may require a period of “catch up” savings, in which the savings rate is increased to make up for the gap between what they need to live comfortably in retirement and how much current savings are likely to provide. On the other hand, peri-retirement may also be a time when individuals explore working fewer hours, starting an encore career or spending more time on hobbies they will pursue after they retire.

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