4 Big Surprises About Working in Retirement (Some Good & Some Bad)
Most Americans approaching retirement have acknowledged — even embraced — the notion that they will want or need to work in retirement. But they may be in a for a few BIG surprises.
A new study of nearly 3,300 baby boomers suggests retirement job expectations may not be realistic.
Commissioned by the Bankers Life Center for a Secure Retirement (CSR), the study surveyed 1,005 middle-income boomers and 2,293 retired boomers age 51 to 69 with an annual household income between $25,000 and $100,000.
And while 60% of respondents indicated they plan to work for pay in retirement, they are largely unrealistic about the compensation, work arrangements and opportunities that come along with doing so.
How do your expectations compare?
1. A Pay Cut for a Retirement Job? Surprise!
More than half of non-retired boomers indicated they would be willing to take a pay cut for their work in retirement, but only two in 10 (21%) would be willing to work for much less per hour. Furthermore, a quarter (26%) would not be willing to work for less at all.
In reality, more than half (53%) of currently employed retirees report making much less per hour now than before retirement, the study shows.
Expectations for compensation differ between middle-income boomer retirees and non-retirees. For those boomers who have already re-entered the workforce, flexible hours trump pay. More than one-quarter (26%) of working retirees are looking for an employer that accommodates flexible work hours or schedules.
In contrast, flexibility is the primary quality for fewer than one in 10 (9%) non-retired workers. Among those workers, more than one-third (34%) say the primary quality they look for in an employer is one that pays well.
2. Working in Retirement — A Rigid Schedule? Surprise!
When it comes to flexibility, nearly all (94%) non-retirees who plan to work in retirement would like some type of special work arrangement, the study shows.
This includes flex-time (56%), telecommuting (20%), compressed work schedule (17%) or job-sharing (14%).
Yet these expectations are also unrealistic, as only about one-third (37%) of currently employed retirees report having such arrangements. In fact, roughly one-quarter (27%) of currently employed retirees have a flex-time arrangement, while fewer than one in 10 telecommute (9%) or have a compressed work schedule (8%) or job-sharing arrangement (7%).
The kinds of work desired by non-retired boomers also prove to be largely unrealistic.
More than one-quarter (26%) of non-retirees who plan to work in retirement would like to do freelance work. In reality, fewer than two in 10 (18%) currently employed retirees do this type of work.
Few non-retirees indicate they would like to work full time (5%), while more than twice as many (12%) currently employed retirees work full time.
3. Competing for a Retirement Job? Surprise!
Boomer retirees represent a large and growing category of potential workers willing to re-enter the workforce.
“In fact, while in 2010 Americans age 55 and older made up 19.5% of the civilian labor force, the Bureau of Labor Statistics projects that by 2020, those 55 and older will be 25.2% of the labor force, an increase of nearly 30%,” the study notes.
Despite the fact that retirees tend to be highly motivated, experienced and satisfied workers — who are willing to make some sacrifices in compensation in return for greater flexibility — many report that there aren’t adequate job opportunities for retired workers.
That’s another area of disagreement among non-retired boomers and those who have already re-entered the workforce.
While 80% of employed retirees report that it was easy to find a job in retirement, more than three in five (61%) middle-income boomers feel there are inadequate job opportunities for retired workers. More than half even say employers could do more to help older workers remain in the workplace.
4. The Biggest Surprise? You Will Probably Find You Enjoy Working in Retirement!
Interestingly, the biggest surprise for retirees who have re-entered the workforce has not been related to compensation levels, work arrangements or job opportunities.
Rather, the biggest surprise is that work is more enjoyable. In response to the question, “What has been the biggest surprise about working in retirement?” one boomer said, “How much more enjoyable the work is when you are not the boss.”
Others added that they also enjoy the added income, the job opportunities available to them and meeting new people.
Advice For Getting Back Into the Workforce
So if you’re one of the many who have decided to work during retirement, remember to keep your expectations in check.
Some boomers say it’s important to take it easy and only work part time, while others advise that working helps mentally and physically, and that for those retirees who want to work, there is no reason to wait — simply “do it!”
Most importantly, employed retirees often say it’s important to find work you like and enjoy.
“Work in retirement can be the perfect time to explore a passion or interest that we were unable to pursue during our primary working career,” said Scott Goldberg, president of Bankers Life. “Don’t feel limited by prior employers, industries or work experience. Look around and find the situation that balances your needs with your interests.”
Make Work a Part of Your Retirement Plan
No matter if you are working for social interaction to help pay the bills, it is important that you have a solid understanding of your retirement finances. The NewRetirement Retirement Calculator is an easy way to plan your retirement.