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Think You’ll Work in Retirement? Think Again

Finding work after the traditional retirement age isn't easy


(This article appeared previously on MarketWatch.)

Two new studies find an increasingly worrisome disconnect between Americans’ plans to continue working in retirement and their ability to do so.

Retirees have long depended on three sources of income to pay their bills in later life: Social Security, employer retirement plans and personal savings. In recent years, though — and, in particular, in the wake of the Great Recession — many individuals approaching retirement say they plan to continue working in some fashion to help make ends meet.

Wanting to Work Doesn’t Mean You Will

The problem: a desire to continue working doesn’t mean that personal circumstances will cooperate or that work will be available.

Many older workers — fully 69 percent in one study — found themselves retiring earlier than they expected.

A study published last month by Bankers Life Center for a Secure Retirement (New Expectations, New Rewards: Work in Retirement for Middle-Income Boomers) found that 72 percent of retired boomers currently aren’t working for pay in retirement.

However, almost half of those retirees (48 percent) said they would like to work — but can’t.  Of those, 35 percent said their health won’t allow them to work, 8 percent said they were unable to find a job and 5 percent said they have to care for a loved one.

Most Retired Earlier Than Planned

The study also found that many older workers — fully 69 percent — found themselves retiring earlier than they expected. Of those, almost eight in 10 (79 percent) left work for reasons largely beyond their control, including poor health (39 percent), being laid off (19 percent) or to care for a loved one (9 percent).

The Bankers Life study surveyed 1,005 workers and 2,293 retirees ages 51 to 69 with an annual household income between $25,000 and $100,000.

Separately, a study by the Transamerica Center for Retirement Studies, also published in May (Retirement Throughout the Ages: Expectations and Preparations of American Workers) found that many workers hope to ease their way into retirement. Employers, though, aren’t always on the same page.

For instance, 41 percent of surveyed workers, according to Transamerica, “envision transitioning into retirement by reducing hours…or by working in a different capacity that is less demanding or brings greater personal satisfaction.” The problem: Only about half of surveyed workers in their 50s and 60s said their companies allow workers to reduce their hours or shift to a less-stressful or less-demanding position.

Both studies found some bright spots. In the Bankers Life survey, more than three-quarters (78 percent) of retirees who are working say they are as satisfied, or more satisfied, with their job compared with their pre-retirement work. And in the Transamerica survey, most workers (77 percent) say that they are financially recovering, or were not affected by, the great recession, including 16 percent who have fully recovered, 40 percent who have somewhat recovered, and 21 percent who weren’t affected.

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