A new study from Bankers Life Center for a Secure Retirement finds that “72 percent of America’s retired Baby Boomers are not currently working for pay in retirement.”
Despite the confusing lede the point is made. People who are retired wouldn’t typically work for pay (because they’re retired), but in this case the authors would seem to be referring to a second career or part-time work after they’ve left a long-term career.
Of the 72 percent, a surprising number (48 percent) would like to work but cannot, due to their own health reasons (35 percent), the health of a loved one (5%) or because they can’t find a job (8 percent). The study, titled New Expectations, New Rewards: Work in Retirement for Middle-Income Boomers, also found a majority (69 percent) of retired Boomers say they would have liked to have worked longer but find that they retired earlier than expected. Among those, nearly eight in 10 (79 percent) retired early for reasons that were not in their control, such as a personal health situation (39 percent), being laid off (19 percent) or could no longer perform their job (6 percent).
Meanwhile, many retired Boomers who are in a position to continue working are doing so for reasons beyond just pay.
Employment now part of the retirement experience
One third (28 percent) of retired Boomers are either currently employed or have been employed for pay during retirement. Of those currently working, more than six in 10 (61 percent) say they are working because they want to work, not because they have to work. In contrast, more than seven in 10 (71%) non-retired Boomers say they are working because they have to work.
While money is the top singular reason for continuing to work for many employed retirees, six in 10 (59 percent) work for non-financial reasons, including to stay mentally alert (18 percent), to remain physically active (15 percent), to have a sense of purpose (14 percent) or to stay socially connected to others (7 percent). Furthermore, half (49 percent) expect to work beyond age 70 or as long as their health will allow.
Flexibility trumps pay for those working after retirement
Boomers are willing to work for less money in retirement. Nearly three-quarters (72 percent) of employed retirees report that their per hour compensation in retirement is less than before retirement, with more than half (53 percent) reporting their hourly compensation now is much less than before retirement.
However, working Boomer retirees would trade reduced compensation for the increased employment flexibility that retirement offers. Nearly nine out of 10 (88 percent) employed Boomer retirees have work arrangements other than full time, including part time (59 percent), freelance (18 percent) or seasonal (7 percent).
Positive impacts of working after retirement Despite lower compensation, working Boomer retirees say they are happier and more satisfied with their job than non-retirees. An overwhelming 78 percent are just as satisfied, or more satisfied, with their job now than they were with their job before retiring. One-third (32 percent) report being much more satisfied now.
Compared to non-working retirees, employed retirees report lower stress levels, better relationships and other positive impacts.
See Also:
- Over Half of Investors Plan to Work in Retirement
- Why Retirement Plans Should Keep Working After Retirement
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
