A Compelling Case For Work in Retirement

Many baby boomers want to keep working in some capacity after retirement. Whether the choice is theirs to make or they are forced to extend the length of their career, more and more people are building work into their retirement plans.

Reasons for wanting to remain a member of the working world vary, but a major factor is money. Most Americans don’t have enough savings to maintain their current standard of living in retirement. The median retirement savings balance for near-retirement households is just $12,000, according to a recent National Institute on Retirement Security report. And an incredible 45 percent of working-age households have no retirement account savings at all.

Social Security alone isn’t likely to provide enough income to make up for a lack of saving. The average monthly benefit for retired workers in August 2013 was $1,270, while the maximum monthly benefit for someone retiring at full retirement age (age 66) in 2013 is $2,533.

Although some costs tend to trend downward as you enter retirement, such as the costs for education for your children and reduced mortgage balances, other expenses cannot be avoided, especially when it comes to health care. The typical 65-year-old married couple without chronic conditions will pay $220,000 to cover medical expenses throughout retirement, according to calculations by Fidelity Benefits Consulting. That figure includes Medicare insurance premiums, but it excludes nursing home care.

Money issues can definitely be a driving motivation to incorporate work into your retirement plans. But it is not always just about money. There are certain aspects of work that some people actually enjoy.

A job can provide an opportunity to be a part of something that is bigger than just yourself. You get to engage with co-workers, work toward and achieve goals and receive recognition for your efforts. Even if your boss does not commend you on your efforts, you receive recognition in the form of a regular paycheck.

Work can also help to channel your energy into worthwhile results. Rather than just keeping busy living your retired life, you have the opportunity to make a difference. A job often feels more meaningful than reading a book, completing a hobby or taking a trip.

New challenges might be a regular part of your work. Dealing with them effectively requires you to use your mental and physical capabilities, and helps you to stay sharper for your life outside of the job.

Of course, not all jobs are rewarding, and not all companies provide a positive environment in which to spend your hours. Monotony, stress, deadlines and conflict can be unfortunate parts of the daily grind.

And not everyone has the option of choosing whether they will work or not. Some people, for reasons beyond their control, are unable to continue with their career. Many people end up leaving their jobs earlier than planned due to health problems, layoffs or to care for family members.

Some people continue to work in retirement for both the paycheck and the social benefits. Whether the underlying motivation is adding to a retirement nest egg or continuing the benefits of working with others to achieve something of worth, work is an option that baby boomers are increasingly adding to their plans for retirement.

From my US News & World blog. Dave Bernard is the author of “I Want To Retire! Essential Considerations for the Retiree to Be“. Although not yet retired, he focuses on identifying and understanding the essential components of a fulfilling and meaningful retirement. He shares his discoveries and insights on his blog Retirement-Only The Beginning.

10 Ingredients for Retirement Bliss

The day is coming when you may decide to depart the working world and join those lucky people living in retirement. You have paid your dues, and now it is time to relax and enjoy the fruits of your labor. Retirement can be a time to do what you have always wanted to do with your life.

Once you make the move, you want to get the most out of those days by living a second act that stimulates your senses and gives you a reason to get out of bed each morning. If you call it quits at 65 your retirement could last for 20 or more years. Here are some important ingredients that can help you live the best retired life possible:

A healthy balance between activity and relaxation. Few retirees would be satisfied with a retirement made up entirely of doing nothing. Sure, after a busy career the first months or initial year of retirement may involve catching your breath a bit. But what about the many years to follow? A life filled with only relaxation can lead to boredom. The best solution can be to seek a balance between activities to keep busy and downtime to take it easy. Finding the right combination that meets your personal tastes can help to keep the days interesting and exciting.

Meaningful moments. At the end of the day, it can be rewarding to look back and see that you have accomplished something of worth. It may be as simple as helping a neighbor in need or as much as dedicating a day at the local shelter. Retirement can begin to lose its luster if you fill the hours without helping others. Meaningful moments and achievements can help give substance to your day and perhaps even inspire you to greater things.

Energy to keep at it. Things get tougher as we age, and slowing down is a natural occurrence. But we don’t want to watch life from the sidelines. Though it’s not always easy, if we can push ourselves a little bit each day to get moving and stay active we will enjoy better health in the long run.

A happy spouse. After many years together making it through the good and the bad, the ability to bring on a smile or laugh with our partner never grows old. What brought us together so long ago has matured and evolved, and hopefully we are learning to accept the inevitable changes that come with the years together.

Remembering the life lived. One of the cruelest parts of aging can be memory challenges. Thoughts of our most vivid life moments may dim with time. Some people are blessed to have sharp minds that are able to recall distant days and events in great detail. But remembering special events and the people most central to our lives is not guaranteed as we age.

Maintaining independence. In an ideal retired life, we will be able to remain in our own home in relative safety and have sufficient money to pay our bills and maintain a reasonable quality of life. But sometimes it becomes necessary to increasingly rely on others as we age.

Being a good grandparent. In the role of grandparent, we have the rare opportunity to be the good guy virtually all of the time. When trouble rears its ugly head, we can call in the reinforcements otherwise known as parents. Our job is to spoil, love and instill happiness in these joyful little people. We all want to be the favorite grandparent who the youngsters look forward to visiting. The good news is all it really takes is some love and attention with a dash of patience and a good sense of humor.

Living according to a personal retirement plan. Whether you want to explore things you have never done before or take it easy, having some idea of how your retired life will look before you quit your job is a great way to focus on the things that can maximize your retirement happiness. Think about what activities, hobbies and events will make up your days, who you will choose to spend your time with and develop a plan to maintain good physical and mental health.

Sharing love. Whether it’s a spouse, good friend, family member or even a fluffy pet, we all need a recipient of our love. We know how happy we become when someone makes the effort to show they love us. And for many people it can be even better to give than to receive.

Not being a burden. In the role of parents, many people have been the person who children could rely upon. We took care of their needs for school, security, health and support. Now in retirement we hope to avoid reversing those roles and becoming a burden on their busy lives.

From my blog on US News & World. Dave Bernard is the author of “I Want To Retire! Essential Considerations for the Retiree to Be“. Although not yet retired, he focuses on identifying and understanding the essential components of a fulfilling and meaningful retirement. He shares his discoveries and insights on his blog Retirement-Only The Beginning.

What’s New for Today’s Retirees

Baby boomers have already begun their transition into retirement, with many already over age 65. Age 65 became the official retirement age in the days of Franklin D. Roosevelt. Prior to that, most people worked beyond age 65. In 1880, 78 percent of men stayed on the job beyond 65. By 1990, this percentage decreased to only 30 percent.

Seniors today are capable of working well beyond 65 in part due to the changing nature of work. Rather than the typical physically demanding jobs of the past, many baby boomers are knowledge workers who use their mind rather than their back. As a result, they have the potential for many productive years beyond age 65. Here’s how the retirement landscape has changed in recent years:

New savings guidelines. Everyone knows the importance of saving for retirement, but guidelines on exactly how much to save have varied. Assumptions about the economy’s rate of growth and average return on investments that held true in the past have come into question. Fluctuations and uncertainty are becoming the norm. At a minimum, we all want to have enough saved to live comfortably and not worry about debt. Fidelity Investments recently recommended that workers save at least eight times their annual salary to meet basic income needs in retirement. At this savings level, by age 67 most workers will have approximately 85 percent of their pre-retirement income to live off of during their retired days.

Retirees moving to cooler destinations. Some retirees have historically opted for the warmer climates found in places such as Arizona and Florida to live out their retirement. However, many seniors these days prefer areas where they can live with four distinct seasons. The cooler climates of Maine, Washington, and Montana are attracting some retirees, sometimes with the added benefit of a lower cost of living and lower tax rates. And should retirees find themselves severely lacking in sunshine, a trip to a beach or tropical island may suffice.

Retirement is not necessarily all or nothing. Some people retire and then discover they miss something about the working world to the extent that they wish to go back. Whether the same job entices them back or something entirely different stirs their imagination, the companionship, interaction, and stimulation offered at work is difficult to replace. Some retirees also prefer to go back and forth between periods of work and leisure. A mix of work and play is now often preferred to an indefinite vacation.

Changing population mix. For every retirement-age person there are currently nine working-age citizens between the ages of 15 and 64. These are the people whose earnings provide the tax base and support for those no longer working. By 2050, this ratio will shrink to five working citizens for every retiree, according to United Nations data. In China the ratio will decrease from the present nine to one to three to one. And in Japan the ratio will be closer to one to one. Such drastic changes in the old-age support ratio will impact the solvency of Social Security, pensions, and public health.

From my US News & World Blog. Dave Bernard is the author of “I Want To Retire! Essential Considerations for the Retiree to Be“. Although not yet retired, he focuses on identifying and understanding the essential components of a fulfilling and meaningful retirement. He shares his discoveries and insights on his blog Retirement-Only The Beginning.