When considering all of the various options for your retirement some important questions to ask yourself are “What are the positive impacts on my life from staying in the workforce?” and “What is the ‘good stuff’ I get from being employed?”
Even if you are really looking forward to retirement is there something about your work that you will miss? Consider any positive effects of your job on your life – will they be missing if you just “walked away?”
Retirement Options to Consider:
Traditional Retirement
This is the retirement that many have promised themselves since they first started working. For many, it means completely leaving the workplace and pursuing a lifetime of fun activities as you enjoy your “golden years.” It offers the opportunity to use the time that you are not spending at work to pursue your other interests and hobbies.
Since this definition is really “work vs. no work,” ask yourself these questions:
- If I won the lottery and money was not an issue, what is it about work that I would miss the most?
- Do I truly look at work as a negative, or is there a positive definition that I might put on it as I plan for traditional retirement? In other words, is traditional retirement what I really want, or do I just want to stop doing what I am doing now?
- Do I have any choices regarding my retirement date, or can I find a way to continue doing what I like to do while working less (part-time, job sharing, etc.)?
Graduated Retirement
Increasing numbers of aging workers would like to combine work and leisure and are considering a “phased-in” retirement that includes arrangements such as working part-time, taking on a consulting role, or job sharing. In some cases, they may be in a position to take a partial pension while still contributing in some way to an employer or to their own paychecks.
There are a couple of reasons why you might choose graduated retirement:
- You still need or want the money (either don’t want or can’t afford full retirement).
- You are still needed in your job and have made an arrangement with your employer to begin pulling back.
If you are looking at graduated retirement as a way of “having your cake and eating it too,” you are not alone. Many baby boomers are considering ways to stay involved, and human resource departments across North America are developing unique ways to keep the “older worker” in the workplace.
Semi-Retirement
This is similar to graduated retirement but is more commonly a retirement strategy for self-employed individuals. The key to enjoying semi-retirement appears to be the control that you have over your time. There is an assumption that you can afford to be semi-retired and that you can call your own shots when it comes to how you spend your time.
Reverse Retirement
One recent demographic phenomenon is the concept of “reverse retirement” to describe the return to the workforce of previously retired individuals. Jack Singh, a 63-year-old retired sales manager who has recently come back into the workforce, said, “When I retired three years ago, I had the idea that I would keep myself busy and not have to worry about how I spent my time. After a year of driving my wife nuts, I decided for the good of our marriage that I should take advantage of an offer to join some old friends in a consulting company. I get to choose the projects that I want to work on, and it enables me to use all of my knowledge in my own field while not totally walking away from retirement.”
The Cornel Retirement and Well-Being study found that 89% of retirees who returned to work in this “reverse retirement” trend did so because they “wanted to keep active.” Some of the other factors listed as reasons to give up on retirement were:
- Had the free time
- Maintain social contacts
- Desired additional income
- An increasing number of Americans are returning to the workforce after retirement. Interestingly, financial security is not the main reason. Many cite “boredom” or “to take advantage of an interesting opportunity” as catalysts.
That trend is expected to continue as many early retirees reassess their long-term work goals due to adopting better health practices, their need to maintain a lifestyle, having a younger outlook on life, and realizing that they may have had a misunderstanding about the allure of continuous leisure.
No Retirement
Many Americans refuse to leave the workplace because they love to be involved. Sadly, however, some work into their seventies and eighties because they cannot afford to do otherwise.
Developing a second career to augment retirement income is quite common today, but it takes planning and time to develop new networks.
The following steps can help you explore possibilities for a second career:
- Create a new personal mission statement. Write down a wishlist of jobs that fit with your mission.
- Review your list while considering your set of unique skills, talents, and strengths.
- Shorten the list to four or five possibilities.
- Reach out to meet people who are working in the jobs or fields you have on your list or talk to those people who run the type of business you’d like to start.
- Shorten your list to a few possibilities and investigate each of these in depth, including requirements such as an advanced or new college degree.
“It is seldom that one retires from business to enjoy his fortune in comfort…
“He works because he has always worked, and knows no other way!”
Thomas Nichols
Let’s talk about what retirement option is right for you and what steps you can take to get there. I can help you map out your plan today so that you can realize your plans for your future.
Joseph F. Falbo, CFP®, AIF®, CRC® is an independent LPL financial advisor that helps grow and preserve clients’ wealth using cutting edge, customized, and comprehensive strategies. With over two decades of experience, Joe helps clients to pursue and retain the lifestyle they want in retirement. To discuss your retirement goals or any financial topic you want, schedule a 20-minute complimentary call. To learn more about Joe, please visit falbowealth.com.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
Certified Retirement Counselor (CRC) conferred by InFRE®