With the possibility of living another 20 to 30 years in retirement, many baby boomers are considering part time work in retirement. According to a report by the Transamerica Center for Retirement studies, 82% of people in their 60’s either expect to work past 65, already are doing so or don’t plan to retire. Likewise, a 2013 Gallop poll found that 61% of people currently employed said they plan to work part time in retirement. While many seek part time work for financial reasons, working in retirement can also provide tremendous psychological and health benefits.
With the loss of traditional pension benefits many retirees need an extra cushion to cover retirement expenses. Working part time can provide many financial benefits including the reduction of distributions from your retirement account. Part time work can also help you avoid drawing from your portfolio when the market is down and the additional income can make you more comfortable increasing the risk in your portfolio, with the potential for higher returns. Another benefit of working part time is the opportunity to delay Social Security benefits till age 70, when you can earn a larger benefit. Additionally, part time earnings can be used to improve your future cash flow by paying off your mortgage, credit card debt, vehicle loans, and proactively address household maintenance and repairs.
Aside from the financial benefits, numerous studies have found that people who work in retirement are happier and healthier. Part time work can give you a sense of purpose, identity and relevance. It can also replace the social interaction that is lost when you retire. A 2009 study in the Journal of occupational Health Psychology found that those who worked in retirement experienced better health. Additionally, a study reported by the American Psychological Association in 2014 found that working in retirement can delay cognitive deterioration.
If you are considering part time work during retirement, start developing a plan before leaving your current position. Leverage and expand your existing network while you are still working. Your current employer may be interested in retaining you on a part time basis or may be aware of other opportunities for you.
Think of creative ways to utilize your skills, experience and passion to find or create a job that you will enjoy. You may want to start your own business doing free-lance work or consulting. Consider turning your hobbies or interests into a business such as tutoring, handyman services, party planning, programming or working for a golf course. If you have management experience you may be able to fill a gap as a temporary executive while an organization is going through a transition.
Keep an open mind, be flexible and stay connected with your network. Here are a few sites that can be helpful in finding part time work; Retirementjobs.com, Flexjobs.com and Coolworks.com. Please use extreme caution when using internet job sites; many are scams that look legitimate.