Is Working in Retirement Good for You?

Why It Matters:

  • Creating a retirement plan helps provide discipline to save what you’ll need for the future.
  • Continuing to work in retirement brings multiple benefits.
  • Prioritizing planning and visualizing your retirement years will provide a clear path.

Kastle Waserman tkc.profilePicture Written by: Kastle Waserman | Transamerica
Aug. 08, 2018

5 Min readClock Icon

When it comes to retirement, you don’t want to leave the funding you’ll need up to chance. Just counting on Social Security and the 401(k) from your employment (if you have one) may not be enough. You need to think about what you will do with your time in retirement, if you can afford to leave work altogether, and if you really want to leave work altogether. As life expectancies lengthen and third-party benefits look more and more shaky, the traditional ways of looking at retirement may not hold up like they did for your parents’ generation.

What is the value of retirement planning?

It’s hard to envision what your retirement will look like from a distance. But one of the most effective ways to start is to make a plan. Retirement planning gives you a framework and forces you to put some thought into it, make decisions, and set a goal to get there.

Recent surveys have shown that “the vast majority of Americans have under $1000 saved and half of all Americans have nothing at all put away for retirement.” Clearly, a lack of planning is creating potential crisis for upcoming retirees. Twenty-two percent say not saving for retirement early enough is their biggest financial mistake.

Whether you’re starting early or need to do a bit of catching up, making a plan will help you take action and consider what you may need in retirement as your third-party benefits, your health, and your ability or desire to keep working may change.

According to Dr. Joe Coughlin (aka Dr. Joe), founder and director of MIT's AgeLab, “A retirement plan helps guide behavior and adds discipline to what people will need in the future.”

See more of what he says about planning for retirement:

If you’re stumped on how to make a retirement plan, don’t fret. Most people have a hard time trying to do it themselves. Put contacting a financial professional at the top of your to-do list. They can help you set up a plan tailored to your wants and needs. They will then check in with you regularly to make sure you stay on track towards your goals and adjust as needed.

Working in Retirement

When you create your financial plan, you may find you either need or want to continue working in your retirement years. As people live longer with the help of modern medicine, “old age” isn’t what it used to be. At the traditional retirement age of 65, you may still be willing, fit, and able to work at the same pace you did through most of your career. If you’re healthy, your lifespan could take you into your mid-80s to 90s, which means more savings needed to cover those years if you retire at 65. Working longer could help you add to your savings rather than withdrawing from them.

There are also health benefits to continuing to work — even if you cut back from the full-time grind and just do part-time work. It keeps you active physically, mentally, and socially. Work may also help stave off dementia, including Alzheimer’s disease.

And there’s the sense of meaning and knowing you’re needed somewhere in the world. According to Dr. Joe, working in retirement is often about more than the money: it gives people a reason to get up in the morning.

See more of what he has to say about working in retirement.

You may wince at the thought of working in retirement. After all, retirement is supposed to mean not working, right? But the prospect of staying mentally vital and active as well as adding to your savings for what could be a longer lifespan may be too good to ignore. Working in retirement might just require a shift of thinking about what kind of work you’d like to do post-career that brings you joy and fulfillment rather than just paying the bills.

Start keeping a file of ideas that inspire you. That could mean turning a hobby into a business, exploring a passion such as spending time with animals at a shelter, or taking a job that keeps you socially connected such as hosting events. Consider working in retirement as a chapter in your life that brings pleasure (and some extra money) rather than the typical 9-5 stress you may have experienced most of your career. Now isn’t that something to look forward to?

Things to Consider:

  • Make a plan for retirement. Contact a financial professional to strategize your wants and needs.
  • Stick with your plan but stay flexible, as your situation may change over time.
  • Consider working in retirement, whether it’s to help your savings or to stay active.

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