Boomers Forced to Retire Face Unexpected Challenges

During the financial crisis, many people vowed they would never retire, and now they are. What changed?

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Borrowing money. It's probably not worth it to apply for a home equity bank loan after a job loss. Bank credit is tight, and you usually need to have a solid job to quality. Reverse mortgages can be a solution. But don't take lightly the urge to spend down your home equity. It's irreplaceable. A better way to borrow in the short term is to withdraw money from your individual retirement account once per year and repay it when expected funds arrive. The limit for repayment without penalty or incurring taxes is 60 days.

Tap tax-deferred savings accounts. This is probably the last choice to consider. The money is easy to get. In retirement (after age 59 1/2), the money is yours to spend without penalty. But using it can generate big tax bills and damage your long-term wealth. Indeed, the flexibility of an IRA is its advantage over traditional pensions that dribble in month by month. For example, you can manage withdrawals over the years to limit tax liabilities. Holding off in a given year can prevent you from getting kicked into a higher tax bracket. Under present rules, there is a big leap at $70,000, from a 15 percent marginal rate to 25 percent. Finally, keeping money growing in a tax-free account has huge long-term benefits.

"A lot of people really hold off on spending IRA funds. They are trying not to dip into those savings and live on Social Security and a little bit of pension income, and if that is not enough, they cut back on something," Rix says. "It definitely makes sense to avoid using your retirement account as an emergency fund. But you still need to plan for the longer term."

[See: 10 Target-Date Funds Producing High-Grade Nest Eggs.]

Those are the immediate steps to take during an unplanned retirement. With so many complications, it's a good idea to get a financial advisor's advice on how to make the most of your resources for the long term, Rix says. Many will advise you to manage your expectations as well when it comes to how much you can generate from part-time work. Still, there are encouraging signs. Workers over 55 are one of the fastest-growing segments of the workforce, especially highly skilled workers. But getting a job after retirement gets harder the longer you are out of the workforce.

For those lucky enough to find rewarding jobs that help them put off claiming Social Security, there can be big rewards. A Morningstar study figures that people born before 1955 who take benefits at age 62 get only 75 percent of what they would receive at age 65. Over time it pays big dividends, especially with average life spans reaching nearly two decades beyond retirement age.

In the boomer era, being jobless and taking a forced retirement can add an element of pain and complication to managing old age. Despite obvious concerns about health and money, MetLife's 2013 survey reveals that retirement can be pleasant. The good news: Among boomers who've taken the plunge, 70 percent say they are enjoying their time.