2. Consider Flexible Work and Retirement
Whatever the reason people decide to stay in a job, it is time to change the way we think about retirement. A one-size-fits-all approach will no longer match the very different plans that seniors and baby boomers have for their later years.
—Herb Kohl, Senator from Wisconsin
Once upon a time, workers left their employers at a fixed age, usually 65, and turned to a life of leisure. Workers who were eager to stop working left at age 62, or as early as 55, if benefit plans made it possible for them to retire early. In recent decades, the average retirement age has been about 62. Few employees have stayed past age 65.
But times have changed. When you turn 55, 60, or 65, most likely you will not need to feel pressured to leave work. You may want to keep on working to earn income, build up your assets, and enjoy your life pursuits. Your options include
• Continued employment—There can be no mandatory retirement age in America (with only a few exceptions, such as airline pilots).
• A change of job or role—You can pursue a different type of work in your company or another company.
• Phased retirement—You can work with reduced hours in the same or a different company.
• Flexible work arrangements—You can choose your preferred workplace and work schedule arrangements.
• Independent work—You can go out on your own and generate your own work and income, as an entrepreneur, a contractor with companies, or a part-time employee at one or more companies.
As a “free agent,” you have the freedom of choice. You have the option to retire from your company and find a new job elsewhere. You can choose and prepare for a different “encore” career, perhaps in a different field. You can work for charities or nonprofit organizations (as a volunteer or for pay). You can try your hand at total retirement and later change your mind.
To make informed decisions, you need to understand these alternative courses of action and their implications. Think of them not only as opportunities, but also as alternatives with consequences, both positive and negative. As you likely experienced throughout your career, your decisions sometimes opened up doors and closed others. As you grow older, you want to be careful in making difficult and important choices. However, you have the benefit of your life-long experience and insight in your decision-making.
This is not to say you must choose only among work alternatives. You may opt to retire completely, withdrawing from the workforce. You may find retirement to be a positive experience—a time to leave the demands and stresses of a working career and pursue other interests and activities. Improve your golf game. Manage your investment portfolio. Maybe develop real estate. Oops—that’s starting to sound like work! You’ll need to determine the right blend of work and retirement as you progress through the “third stage” of your life. The reality is that you’ll likely have at least two decades for retirement and work activities—ample time to experiment, change your mind, and make different choices.
This chapter considers alternatives of continuing work rather than abruptly retiring. The following sections describe a variety of arrangements for work, leisure, and retirement that may be available to you.
Your parents and many older members of the baby boomer generation did not consider retirement to be a choice. Ceasing to work at a certain age was considered inevitable and encouraged by employers in order to make way for younger talent. Viewing retirement as an age-based milestone contributed to the idea of a “retirement cliff.” The concept was created as part of the design of retirement benefit programs during the twentieth century. The term suggests that individuals lose status as they approach the edge of the cliff and then fall into new lifestyles for which they may be neither desirous nor well prepared. In fact, retirement can leave many older workers frustrated, angry, and, in some instances, poorer. Without the support of generous pensions and health benefits, retirement can look less like “golden years” than a “scrap heap of life.”
Over the course of history, workers (many of whom were farmers) typically continued to work as long as they were physically able. They continued working because they had no assurance of sufficient assets or income to sustain them without work. To withdraw from work and shift to leisure was a luxury few could afford. Thus, over time, retirement has become a well-established social marker, signaling an expected shift into a new, late phase in life. Since the 1950s, many Americans have looked forward to retirement and planned for it. Retirement income and health care benefits provided by employers have been very powerful and positive incentives to leave work. The attractions of retirement have been promoted heavily by businesses focused on a particular niche of retirement-related needs (retirement communities and housing, insurance, financial services, travel and leisure, health care, and so on).
Yet surveys show that about 75% of boomers age 50–60 say they intend to work; only about 25% say they will retire and live on their benefits and savings. This is a significant change from past patterns: Persons 60–70 have typically retired (70%) and only about 35% work. Of course, the choice is a personal one. You have the luxury of doing what you conclude is the best course for you in a changing environment and at a time when boomers are challenging and exploding traditional models of aging and retirement.
As an example, at 58, Bob took early retirement from his company in New York. After 25 years, he had had enough, and was reluctant to live through yet another change in management. His house in the suburbs had appreciated greatly in value, and he and his wife decided it was time to make a big change. After a short period of international travel, they sold their home. They bought two condominiums, one on the New England coast and one in Florida. They divide their time between the two and have built friendships, found new activities, and have thoroughly enjoyed being “out of the city.” They are in good health and have sufficient assets and retirement income to meet their needs.
Bill, on the other hand, retired early from IBM and joined some friends in a small consulting firm to continue using his expertise in management development and to supplement his retirement income. He also became involved with a local college to help them develop and conduct executive development programs and an executive MBA. He built upon his professional and corporate experience to continue the professional work he enjoys.
Ivana had a unique experience, reminding us that, despite pursuing a dream that didn’t pay off, she had no regrets about trying her hand at entrepreneurship. A corporate executive who worked in corporations her entire life, she always regretted not being able to capitalize on her artistic abilities. At age 60, she decided to retire and become a personal shopper for clients seeking the perfect pieces of art for their homes or offices. After a year of running around the country to find just the right works to meet her clients’ desires, Ivana was not only tired of the extensive travel but found minimal margin and even less joy in what proved to be a frustrating undertaking. Yet when describing the choice she made, she valued the chance to learn first-hand what it was like to be an entrepreneur. Rather than living her life without ever knowing if she passed up actualizing on her true passion, she returned contently to the corporate world as a part-time consultant knowing that she’d satisfied her desire.
As the preceding examples indicate, retirement decisions often involve risk-taking and experimentation. They can also result in multiple changes, including relocation, new relationships, new priorities, and alternate spending patterns. In considering when or whether to retire, you might consider these factors:
• Will your retirement income/financial resources for retirement be adequate?
• Are your peers and colleagues retiring or are you the only one considering this alternative?
• Are leisure and other activities even more attractive to you than work?
• Is your work physically demanding, stressful, or otherwise unpleasant?
• Do you face issues of poor or declining health?
• Is your spouse or partner interested in retirement and the opportunities it offers?
• Are you experiencing age discrimination, whether overt or subtle, in your workplace?
• Are few opportunities available for you to continue working—whether due to job scarcity, obsolescence or narrowness of your skills, or competition with others for work?
• Are you bored with what you have been doing and ready to explore alternatives?
• Do you have an unrealized dream in mind—something you’ve always wanted to pursue—and are now ready to explore possibilities?
Many people say yes to these questions. In recent decades, most people have opted to live longer in retirement rather than to extend their working careers. During the 1960s, there was a widespread belief that automation and improved productivity in America would enable older adults to stop working and instead enjoy leisure activities. The young baby boom generation promised to take over the working roles and to drive economic growth and prosperity that would permit a good lifestyle for all. The strong economy made retirement attractive. Retirement communities cropped up in Florida, California, and Arizona. AARP (then called the American Association of Retired Persons) expanded as a voice for the growing retired population and as a provider of services to them. Now those young boomers are facing their own retirement decisions.
Employees covered by a defined benefit pension program and a retirement health care plan are more likely to take retirement than those who are not. Those covered under defined benefit pension plans often have an incentive to leave their employer as soon as they are retirement eligible (for example, age 55) and work elsewhere. They can begin to collect their pension, which often includes an increased supplemental early retirement benefit, while also earning a salary at another employer.
Yet the decision to retire is not always voluntary. Many employers have encouraged older workers to retire as a means of reshaping or downsizing their workforce. A study by MetLife found that among persons age 55–59 who retired, the two most frequently cited reasons were: “offered an early retirement package (36%) and business closed/downsized (17%).” When retirements are “encouraged,” individuals are less likely to have thought through their options or made plans for their future. In many cases, these retirees end up returning to the workforce in order to supplement their (inadequate) retirement income.
The trend-setting baby boomer generation is challenging traditional notions of retirement and exploring alternative ways to remain engaged in the world of work. The idea of a “normal” retirement at a certain age will no longer be relevant. More are staying in the workforce than the previous generation. MetLife’s research revealed trends toward later retirement, reflecting a wider variety of work and retirement patterns among persons in the age group of older baby boomers.
Asked whether their concept of retirement had changed, 47% of older boomers (55–59) said “yes.” As leading-edge boomers make their own career choices and pursue alternate paths, younger boomers will likely follow, significantly changing the landscape of work and retirement.
—MetLife, 2006
Why retire? Why should you step aside for others to take your place? Why should you “drop out”? Given projections that you and your peers can expect to live long into your nineties, how realistic is it for you to think about retirement before age 65 or 70? The most satisfying and productive years of your life may lie ahead. You can take advantage of your accumulated professional talents and career accomplishments, your experience in a variety of organizations and industries, and your motivation to pursue interesting work and to ensure greater financial security.
MetLife’s research found the primary reason individuals age 60–65 retired was that they “wanted to try something new and different.” New life patterns will allow for the continuous reinvention, ongoing improvement, and choice of work throughout one’s life. You may find your desire to “rewire rather than retire” is a primary factor in your decisions. When you have ten or twenty active years ahead, what will you want to do? Answer: something meaningful.
The boomer generation will swell the over-age-60 segment of the population to 70 million over the next 20 years. Today, turning age 55, 60, or 65 has less significance as a turning point for boomers, who are generally in better health, enjoy their work more, and are more eager to keep earning money more than previous generations. Retirement age is no longer meaningful as many boomers reject retirement as an event and instead move in and out of the workforce until they are 70, 75, or older. There will be no retirement age cliff.
Instead of reaching a retirement age that might signal a loss of meaningful roles or human relationships, you may cycle in and out of a career, take breaks in between, and develop new capabilities. You will likely move in and out of periods of work while also devoting time to learning and leisure and personal interests as you choose. The traditional model of life stages—learning in school, then working, then retiring to leisure—is not likely to be relevant for many boomers. You can instead “shuffle” your life stages so that you return to education and develop new talents several times in your life; you may take time for leisure between jobs or periods of intense work. Indeed, many boomers are already working as free agents—providing consulting or services to clients on a project basis, permitting them to work hard, then play hard, and continually reinvent their “personal brand.”
Generation X and Y employees are expecting employers to provide more work-life flexibility, including work hours, time away from work, and sabbaticals and leaves. Boomers can benefit from the changes and policies that these younger employees encouraged employers to develop and implement. Women, in particular, have led the way in establishing new expectations for flexibility in work and careers, making it acceptable to take leaves for childbirth, child-rearing, and parental responsibilities, and also by shifting career directions and pursuing non-traditional occupations. Taking time off, reducing work schedules, or stopping out for periods of time is rarely looked on as a “career killer” any more. The federal Family Medical and Leave Act has facilitated breaks in “normal” work and career patterns frequently sought by employees.
Just as you might ask yourself why you would want to retire, also ask yourself why you would want to work. Consider these questions:
• Do you enjoy your work? Would you rather keep working than retire?
• Are there new or different work and career opportunities out there that you feel are attractive and exciting?
• Have you had second thoughts about your career? Was there another path not taken? Would you like to change directions and follow that path?
• Do you expect to be healthy, active, and interested in meaningful work well beyond age 65, or even 70 or 75?
• Will you need to earn further income to maintain the lifestyle that you enjoy?
• Will you need to help meet the needs of your aging parents, your children, or your grandchildren?
• Have you saved a sufficient amount of money or do you have sound investments that will allow you to stop working? Do you know how much you’ll need?
• Will you need to keep putting earnings into your savings, in anticipation of retirement? If you have not saved sufficiently over the years, do you want to give a “boost” to your retirement by continuing to work?
A Towers Perrin survey found that more than 78% of employees said they plan to work past retirement age, either to stay involved and active or for financial reasons. Respondents said they do not aspire to retirement as a period of absolute leisure at the end of their careers. Only 22% said they planned to retire as early as possible and would not seek other employment. Of those employees planning to work in their later years, 64% said they expect to work part-time, and most plan to change occupations. These data reveal a decided shift in how people plan to spend the second half of their lives.
Higher workforce participation rates may very well lie ahead as boomers opt to stay working. Among persons 55–64, labor force participation increased between 1994 and 2002. Participation by men rose from 65.5% to 69.2%. If boomers continue to stay at work as they pass the age 60 mark, the trend of increasing workforce participation in the older age groups will continue, particularly among boomer professionals.
However, more employees typically say they will continue to work beyond normal retirement age than actually end up doing so. Today’s older workers tend to stop working for pay by the age of 70. As boomers move into these ranks and make their own decisions, it is uncertain whether they will have the zeal for working that they anticipated they would. One of the key factors is what their peers do—you will certainly keep an eye on what your friends and colleagues do.
Most people age 50 and over choose to work instead of retire for several common reasons, along the lines of those discussed previously. Research studies conducted by MetLife and AARP identified the factors individuals considered to be most important. The following are the factors, in order of importance:
1. Need for income to live on
2. Want to stay active, engaged, productive, and useful
3. Want the opportunity for meaningful work
4. Want to maintain lifestyle, and do things that are enjoyable
5. Need to build additional retirement savings
6. Want to enjoy the social interaction with other people
7. Need to retain or acquire health insurance benefits
The factors that drive your own decision will, of course, reflect your personal desires, knowledge of options, and circumstances. It is clear, however, that the forces driving individuals to stay at work are compelling and reflect a combination of economic, social, and personal factors.
Additional studies show that working to an older age has positive physical and psychological effects. Older employees who work in low-stress jobs with the hours they desire experience better health. Studies at Boston College found that, contrary to popular wisdom, even physically demanding jobs may have a positive effect on the physical health of older workers. Staying active is very important. For many persons, work is fundamental to our personal identity and self-worth. On the other hand, studies show that retirement continues to provide freedom to pursue other activities or interests that may have similar positive effects. The conclusion? Stay active, and you’ll stay healthy and happy.
Anyone I know that is in the workforce over 65 will say that both the challenge and the mental stimulation is a huge part of maintaining their quality of life, both physically as well as mentally, in terms of really having that productive and that great quality of life that they feel like they have.
—Blanche Lincoln, U.S. Senator
The following sections discuss some of the possible work options that you can consider if you intend to continue working.
What do we know about boomer’s intentions to work? Based on the many surveys conducted by various companies and organizations, we can see the trends. Today, part-time work is more common than full-time work after age 60. A MetLife survey of persons currently age 60–70 found that 38% were working. However, only 39% of these individuals were working more than 35 hours per week. This means that only 15% of those working worked more than 35 hours weekly. After age 65, fewer than 20% of people are actively participating in the workforce.
A majority of respondents in a Towers Perrin’s survey indicated that they expected to work part-time (64%); only 21% said they expected to work full-time in their current occupation after “normal retirement age,” while 65% stated they planned to leave their current occupations and move into work unrelated to their career occupations. Most said a change in occupations would allow them to pursue new interests and opportunities for personal growth.
Similar to other research studies, Merrill Lynch found that the majority of boomers (75%) intend to keep working in retirement. Individuals surveyed expected to retire from their current jobs at the average age of 64 and then launch a new career. Some want to stay in the same type of work, but with more flexible scheduling. Many more indicated they would like to have a different, more personally rewarding job. Nearly half would like to cycle between periods of work and leisure.
Two in three individuals (65%) of the respondents in Towers Perrin’s retirement research said they planned to leave their current occupations before their normal retirement age. Of those employees planning to work in their later years, only 21% said they expect to work full-time in their current occupation after retirement age. Interestingly, they do not intend to stay with their companies to continue doing what they have been doing.
Self-employed persons tend to keep on working without regard to their rising age, like craftsmen and farmers in past centuries. However, a study by RAND for AARP found that nearly two-thirds of older self-employed workers made the transition to self-employment at or before age 50. This means that many individuals found that major career shifts (and risk taking) were achieved early, but also that one-third did so later even though the challenges may have been more difficult. It suggests that many people make such major changes when they experience a midlife crisis and that the changes are more easily made then than in later retirement years.
Jeff Taylor, founder of Eons, a website tailored for boomers, believes that boomers see themselves as graduating from corporate jobs to pursue entrepreneurial or personal goals. Even those who continue to work in regular jobs want to do something that expresses their personality, their interests, and their hidden skills.
Another emerging trend among individuals is to phase in their retirement—continuing to work either at the same company or another company with reduced work hours prior to retiring altogether. A large proportion of these workers are in white collar, professional, knowledge worker roles. Blended work and retirement—often referred to as hybrid retirement, partial retirement, phased retirement, or gradual retirement—characterize the working retired.
Boomers, in particular, are considering flexible options, often combining work and other activities. They are seeing retirement as a gradual process of withdrawing from the workforce, not a single act of leaving work entirely or as an objective or destination. Boomers who enjoy working or who need the income may work well into their seventies and eighties before fully disengaging from the joys and demands of work.
Retirement is a transition that varies widely for workers who follow different paths on the road to full withdrawal from the workforce. It is not always clear when retirement begins, and so it is difficult to calculate an average retirement age. For many, retirement is not an abrupt shift from work to leisure. Many shift instead to a new employer, a new type of work, and possibly a reduction in work hours.
A phased retirement program encourages older employees nearing retirement to remain contributing members of the labor force beyond the time they otherwise plan to work. Phased retirement programs could attract older workers to remain employed and to boost the economy through longer workforce participation by experienced employees. It also expands options for older workers and allows them to ease into retirement gradually, before completely exiting the workforce. Employers are thereby able to retain hard-to-replace, experienced workers.
A telephone survey of attitudes toward phased retirement by AARP found that only 19% of respondents had even heard of the term “phased retirement.” Of these, nearly 38% said they would be participating in such a program. However, once it was explained to them, of respondents who expressed interest in phased retirement, 78% expected that the availability of such a plan would encourage them to work past their expected retirement age. Forty-six percent of interested workers said they would like to begin phased retirement between ages 60 and 64; 53% said they would like to work 12 fewer hours on average, if offered phase retirement.
A study by Watson Wyatt included telephone interviews about phased retirement with 1,000 individuals ages 50–70 and was supplemented by focus groups. Most surveyed hoped to work part-time (63%), work in a different career area/field (63%), or work more flexible hours (48%). The survey found that the greatest interest in flexible arrangements was among individuals before the current average retirement age of 62 ; 59% of the respondents ages 50–59 were interested in phased retirement.
To facilitate phased retirement, changes in compensation and retirement benefits rules are needed. In 2005, the IRS proposed to permit a portion of an employee’s accrued pension benefit to be paid upon phased retirement. The amount paid would not exceed the proportionate reduction in hours worked (at least 20%). Other changes in the IRS requirements would also ease phased retirement. These include the following:
• Simplified requirements for maintaining detailed work records and adjustment of benefits
• A phased retirement option as early as age 55 (when early retirement benefits usually kick in)
• The use of lump sums as phased retirement benefits or payment of phased retirement benefits as in-service distributions
• Temporary additional benefits
• Separation payments to avoid early distribution taxes
You could also consider bridge employment. That is, find a bridge job that allows you to transition less suddenly into an unstructured environment and to fill the gap between a long-term career and full-time retirement. Rather than abruptly leaving your company, you may continue to work in some form for a longer period of time after retirement. Bridge employees find such arrangements valuable as they provide continuity and minimize the isolation that often accompanies retirement. Some individuals have opportunities to mentor their successors. Research suggests that bridge employment helps those who may not be psychologically ready to retire by adopting a phased-in approach to retirement. Bridge worker studies in organizations that offer this option revealed that employees valued having continued activity, a daily structure, and less stress. Workers also reported increased self-worth and satisfaction as a result of their providing guidance to the next generation.
As an example, Harold spent nearly 30 years in a human resources career at his company. He eagerly (or at least willingly) moved from one functional area to another, and held generalist positions as an HR Director. However, after several reorganizations of the human resource function, he opted to move into a different corporate staff group. Although it didn’t tap his specialized human resource expertise, it enabled him to stay with the company a few years more, as a transition to retirement. Or perhaps he’ll go back into human resources for another tour of duty when it restructures again. They need his expertise.
Another bridge retirement option is to serve as a mentor or guide to new employees who are joining your company. Individuals who are facile at developing others and who possess valuable corporate memory can be invaluable resources. Helping to socialize newcomers to organizational culture, share best practices, orient new employees to organization politics, and help people avoid potential landmines is a way for experienced workers to add value as they prepare to exit the company. Such bridge roles not only benefit the employee, but they also allow for the transfer of organizational knowledge that could otherwise be lost with the abrupt departure of long-term, savvy employees.
You can shape a combination of work and leisure that meets your needs while simultaneously performing work that is important and meaningful. Like younger generation X and Y individuals, you can also opt to balance your work and your personal life through flexible, customized arrangements. As you chart your own career path, you will likely find employers to be increasingly supportive—they need to retain or recruit retirement-eligible employees who have special knowledge or skills needed for the business.
Some employers are providing flexible employment arrangements for older workers, including rehiring retirees and offering part-time or seasonal work, reduced work hours, and job sharing. However, in reality, a 2001 study found few such arrangements, and these are ad hoc and cover few employees. Typically, the arrangements are provided to skilled workers with expertise that employers need and that are hard to replace. Employers say they simply have not considered formalizing flexible employment contracts because they have not felt them to be necessary. Other reasons are incompatibility with the organizational culture, employment costs, restrictions on pension distributions, and productivity concerns.
Many people find that a gap exists between the phased working arrangements that they prefer and the roles or opportunities that are available to them. Most would like to stay with their career employer and work fewer hours or work in a more flexible work environment before retiring completely. For each phased retirement option, the availability of programs offered by current employers falls short of what’s desired. These preferences, as reflected in the following survey data, frequently impel workers to leave the primary employer and pursue opportunities with other employers, to start their own businesses, or to work independently as contractors.
• Work more flexible hours (48% of employees desire; 34% of companies offer)
• Work fewer hours (63% of employees desire, 49% of companies offer)
• Reduced responsibilities (50% of employees desire, 33% of companies offer)
• Do something completely different (63% of employees desire, 45% of companies offer)
Many employees would like to continue working part-time with their current employers to whom they may be very loyal. However, to make arrangements work financially, many workers needed to unlock some of their retirement benefits. This is problematic under defined benefit plans that require an employee to stop working before receiving benefits.
Proposed changes in IRS regulations could facilitate implementation of phased retirement plans. These regulations would allow defined benefit pensions to pay partial retirement benefits prior to retirement to eligible employees who reduce the number of hours they work on the job by at least 20%. If adopted, the regulations would be an important step toward allowing one type of phased retirement—a reduction of work and partial pension payments—while protecting future retirement income security and the integrity of the pension system.
If employers want to retain their older, more experienced workers, they will need to offer more flexible work arrangement alternatives. If the impediments continue, boomers may pursue informal working arrangements, or simply take retirement and then move over to other employers for work, or work independently as entrepreneurs or freelance, contract talent.
As you progress through your fifties and sixties, you have the discretion to make choices about when to retire, whether to continue working, and under what arrangements. Such choices are difficult, requiring evaluation of alternative options, realistic assessment of your personal capabilities and resources, and clarification of your needs, goals, and aspirations. You may choose to retire or continue to work, or find a blend of the two. You may balance your personal risk with security. You may choose to sustain your career direction and your strengths or you may strike out in a new direction and reinvent yourself.
Retirement need not be a cliff. Through careful planning and action, you may make choices that provide security, challenge, meaning, and satisfaction that will make your life fulfilling. Are you comfortable evaluating your work and retirement options? Do you have the information you need? What factors are within your control (for example, free agent)? What factors are outside of your control (for example, organizational retirement policies)? The choices you consider will most likely be based on your answers to the following questions.
Will you retire early, at normal retirement date, or defer retirement? You may opt to follow the lead of others and retire when they do. In some cases, opportunities shape decisions, as when Ford Motor offered a special incentive for early retirement to all of its employees, and half accepted the package! As discussed in this chapter, the decision to retire is influenced by your health, your financial situation, whether you are enjoying your work and see it as meaningful, and whether you have friends at work. On the other side, your timing will be influenced by your aspirations, your goals, and your needs. Are there things you want to do? Are you ready for a change? Are you eager to enjoy retirement? How accepting is your spouse or partner of your retirement timeline? Of course, choosing to retire from an employer may simply mean you are now receiving retirement benefits—and not that you are going to stop working entirely and turn to a life of leisure. Many boomers will continue to elect retirement and adopt a different lifestyle.
You may consider shifting to part-time work, a flexible work schedule, working from home, or other phased-retirement arrangement. You may opt to move to a different job or location within your organization, but one related to your experience and skills. You might take a less demanding job, working “back down the ladder.” It is becoming more common (and organizationally acceptable) for managers to move to individual contributor roles—which entail less responsibility and stress, but provide satisfaction. Might you be well suited for mid-level roles? Are you willing to make a lateral move or fill an organizational need that may not be as challenging as previous roles in order to remain with your present employer?
You may choose to move to another employer—as a way to find more interesting work, more pay, better benefits, new friends and networks, or opportunities to learn and grow. Or you may move in order to move—to a new location, perhaps in anticipation of retirement. You should evaluate the effects of a change on your pension benefits, retirement eligibility, vacation time, and other conditions. Of course, after you have retired from your employer, you are free to work for another company.
You may choose more independence and flexibility in your work, establishing a transition toward retirement that can include the amount of work you desire. It may be easier to become a free agent. At age 55 or older, you might need up to a year to land a new company job. And then, if past patterns prevail, you may be leaving that job three to five years thereafter. As a consultant or independent contractor, you may work for your previous employer or others. If you feel entrepreneurial, you may opt to build a business, with employees and a profitable business model. Free agents work independently in different kinds of work with different clients—sometimes long-term relationships, and often serial, short-term relationships. AARP reported that 7.4 million Americans are self-employed and half are boomers over age 50. There are risks in being an entrepreneur. If you want to run your own business, some experts advise that you buy an existing, successful business that you can make more successful (has positive cash flow and growth potential), rather than starting a business from scratch (Zissimopoulos and Karoly, 2007).
You may do something radically different. The opportunities are there if you have the will. Some folks climb Mt. McKinley, some go back to college for a new degree, some shift careers, some dedicate themselves to religious or social work. If you have a passion, go for it. Some of these options don’t last long. Many persons longed to travel—to hike in Patagonia, to explore Australia, to tour China, to sail around the world on the Queen Mary. After a year or two of travel, they typically revisit their options for work or other activities. Many books are available that can provide guidance on reinventing yourself; they also provide inspirational case stories. It is never too late to do what you really want, although authors suggest that the major changes are best undertaken early (for example, as a response to a mid-life crisis in one’s forties).
There are no perfect choices. Your decisions will by necessity be made based on limited knowledge and your sense of what the future holds. Indeed, rather than seeing decisions as forced choices, you may well seek a dynamic balance among a variety of alternatives. Of course, you can change direction frequently, as many boomers have done throughout their careers. Work and retirement are not opposites, but like the Chinese concepts of Yin and Yang, they may be complementary. Aging need not necessarily mean decline and withdrawal; it may also mean growth, exploration, and discovery. The important thing is that you approach your choices with a positive attitude and enthusiasm.