ARE YOU READY TO swap your office chair for a rocking chair? Hold that thought.
Before you dive into the world of endless vacations and gardening, consider that keeping a toe—and perhaps your whole foot—in the workforce might be the secret ingredient to a fulfilling retirement. Don’t believe me? Here are seven compelling reasons to keep working at least part-time.
1. Stay young at heart. Remember the excitement of landing your first job? That thrill doesn’t have to end. Continuing to work, even part-time, keeps your brain active and challenged. It’s like a gym membership for your mind, warding off the cobwebs and keeping you mentally sharp. Learning new skills and adapting to new environments can be the fountain of youth for your brain.
2. Social butterflies keep fluttering. One often-forgotten benefit of work is the social connections. Picture this: engaging conversations by the water cooler, team lunches, and the camaraderie of working toward a common goal. These interactions are invaluable and keep you connected to diverse groups of people, ensuring that your social life remains vibrant and dynamic.
3. Even more financial freedom. Who doesn’t love an extra bit of cash? Continuing to work means more financial breathing room. You can fund those dream vacations, spoil the grandkids or simply enjoy the peace of mind that comes with a steady income. It’s not just about the money. It’s about the freedom and choices that money can provide.
4. Purpose, passion and pride. Work can be a significant source of all three. Whether you’re mentoring younger colleagues, contributing to meaningful projects or just being part of a team, these experiences validate your skills and experience. It’s about feeling valued and knowing you’re making a difference.
5. Keep the doctors at bay. Believe it or not, working can be good for your health. Studies suggest that those who continue working tend to enjoy better mental and physical health. The combination of mental stimulation, social interaction and a sense of purpose creates a powerful health cocktail.
6. Flexibility is the new black. Retirement doesn’t have to be all or nothing. Many retirees find joy in flexible work arrangements like part-time jobs, consulting or freelance gigs. This flexibility allows you to balance work with leisure, family time and hobbies. With the right job, you get to design your golden years exactly how you want them.
7. The joy of lifelong learning. Ever wanted to try a completely different career or learn a new skill? Now’s your chance. Retirement can be the perfect time to explore new interests or passions in a low-pressure environment. Who says you can’t be an intern at age 60 or start a new venture at 70?
Bottom line: It’s your adventure. Retirement is a journey, not a destination. By incorporating work into your retirement plan, you’re not just adding years to your life—you’re adding life to your years. It’s about finding the right balance that makes you jump out of bed each morning, excited for the day ahead. So, what will your retirement adventure look like?
Dan Haylett is a financial planner and head of growth at TFP Financial Planning, a U.K. firm that specializes in modern-day retirement planning. Dan’s “pull back the duvet every morning” purpose is helping clients spend their time and money on what’s truly important to them. A version of the above article first appeared on Dan’s website, where you can also learn about his Humans vs. Retirement podcast. Follow him on X (Twitter) @DanHaylett. Dan’s previous article was The Changes Ahead.
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This article reminds me of the argument to set the retirement age for social security age to an older age. This may be fine for those of us who enjoy our jobs or who do not do hard labor. But for those who do manual labor as part of their work such as construction, police work or firefighting, is it realistic? It is easier for those whose work is mostly heavy thinking instead of heavy lifting to have the luxury of continuing to work and make money.
And there’s no prescription for a toxic boss.
I’m going to retire next year after a 35-year career as a professor. Until recently, I’ve always loved my job, but over the past several years, some toxic university leadership/politics has made it close to unbearable. (I still do love teaching and mentoring students and doing my own writing.)
I won’t need to work after retiring from this job for financial reasons, but lately I find my mind wandering to places where I think it would be fun to work part-time. Trader Joe’s, for example. I’m there several times a week, anyway. As a dog walker because I love both walking and dogs. This past weekend, we went to spring training baseball in Arizona. It seemed like most of the workers at Scottsdale Stadium—shop, concessions, ushers, ticket takers—were my age or older. Lots of retirees in Arizona, and if you love baseball, how fun might that be for the six weeks of the spring training schedule (or the six weeks of the Arizona Fall League)?
I notice that all of these options are about as different from being a university professor as they possibly could be. Clearly I’m burned out and want a change. Chances are I’ll fill up my time with volunteering and social life, though, because I do want the flexibility to travel when and where we want to.
Dr. Lefty,
I feel your pain! I retired in January, 2024 after 15 years as a college professor, which was preceded by 40 years as a financial services professional. Like you, I relished my students and contributing to their growth, both personally and professionally, and I loved my teaching duties.
The rest of it became unbearable. With DEIB being crammed down our throats and leadership with little academic experience, my institution was becoming another bastion of political correctness.
Having saved and invested, especially in my later years, I knew that at my age (73, wife 69) I had guaranteed cashflow of a minimum of $100K a year, for the rest of our lives….minimum. That made it a lot easier to submit my “intent to retire” paperwork 6 months in advance. I only waited until January, vs. December, to enable an additional $19,000 to be contributed to our Roth IRAs for tax year 2024.
I have been content to go to the gym 3-4 days a week and attack my to do list around the homestead. (We live on 6 wooded acres in NC.). I thought I would miss it, at least a little, but honesty, I am glad to be free and clear of the toxicity that is academia today. I will look for other things t do over the next 6-12 months, but first some travel and then some evaluating where do we want to retire to? FL, GA, TN, SC, PA, W VA, or stay in NC.
Wherever it is, it will be a conservative area in a conservative leaning state. I have had all the left-leaning, anti-American, politically correct a-holes I can tolerate for the rest of my days.
Enjoy your retirement.
With that, don’t retire to Hawaii.
Aloha.
From someone who stood on their feet for 30 plus years and had physical demanding work, the post retirement work does not interest me. I find enjoyment in just helping my neighbors or friends with small projects or just having conversations with them over a cup of coffee. What some people wouldn’t call volunteering, I donate plasma and platelets on an average of twice if not three times a month at the local nonprofit blood bank. It takes an average of two to two and a half hours each time. Also had volunteered in an overnight program with my church for many years.As one of the frequent contributors here Dave Gartland(sp) mentioned a while back about volunteering is like paid work. You don’t get a paycheck for it. Not that you should.Remember when my father volunteered to drive the coach at a retirement community where the CEO made $250,000 plus if not more, couldn’t afford to pay someone to drive it. Bunco! Some of these volunteering opportunities actually take away paid work for someone. I understand one can have new experiences and opportunities. I realize many contributors here have the gifts and talents to continue providing their expertise and such in their related fields in volunteering, yet some of us are just tired of work and want to hang it up for an non-work/volunteer retirement. I finally been able to catch up on my skiing and traveling in retirement.
P.S Jonathan, reading and following your suggestions since you wrote at WSJ given my wife and I a comfortable start in retirement. Thank you
Glad things have worked out well!
I’ll put in another huge plug for volunteering! (Bold and Underlined:) I have volunteered for various non-profits most of my life, but retirement allowed me to expand those commitments. Trust me, there are plenty of (all) organizations that would welcome your time and expertise.
I’ve never read an article here that I agree with more — with one qualifier, from my perspective. All the joys that I derive from my continued consulting gig is achievable because I work from home. If I had to get in the car (or on the ferryboat, in my case) to commute to a job, all those joys would be muted or lost altogether. I get plenty of social interaction from Zoom and conference calls — no need to gather around a table.
I’m also fortunate to be able to continue to learn new things within the context of my job, which is media relations for medical device companies. I am constantly learning about exciting new medical technologies, which are plenty challenging for my shrinking intellect!
Yes to all of those thoughts. But, it doesn’t have to be paid work. I don’t need any more money but I get all seven of those other benefits from chairing a college board, a hospital board and a foundation board and mentoring engineering students, plus a few other volunteering gigs. Travel and continuing education are also part of those.
Maybe this is a future HD article for me. I planned to retire at 67 after 20 years with the same company. I enjoyed my work, I especially enjoyed almost all my coworkers. In my last six months of employment (I did not tell them I planned to retire), I had three different managers – all with three different business goals. On top of that, the entire desktop infrastructure was undergoing massive changes. It was an easy decision to leave. The nature of my work did not support a part-time engagement, and I didn’t want to do that anyway. Within weeks I was in a woodworking class, exercising more, eating better, and engaging with my social circle. I’m not looking back. 🙂
Being at an age where RMD’s are required I like the idea of choosing some part time employment to give me the option to make a current year contribution to my tIRA or my rIRA. For me, those IRA contributions are only limited by my current earned income. I can choose to make such contribution after year end when I can better target the taxable income I would like to hit with greater precision. By making the contribution after year end any traditional contributions will not be in the base that is part of the tIRA RMD calculation for the following current year. I will likely take my next year RMD early next year to fund any prior year IRA contribution.
If I had not rolled my former employer 401(k) to my IRA and had continued working for my former employer I would have delayed the required RMD from that 401(k) as long as I continued to work for the same employer. That 401(k) plan had limited investment choices, high plan expenses (compared to my IRA) and inflexible distribution rules which were the main reasons I chose to roll my 401(k) to a IRA when I stopped working full time and left that employer.
I am now doing some part time (approximately 25 hours a week), seasonal work (maybe four to five months) in the field I spent 40 years working in. I am working for a small local company with colleagues I have known for decades and they are happy to have me helping.
After six months of work with my new employer I should be eligible to participate in their 401(k) plan. My income in 2024 will be such that, starting after the plan’s six month waiting period, I may elect to contribute via a Roth elective contribution into the company 401(k) plan, and may also use the same earned income which is eligible for me to make a IRA contribution to a tIRA and/or a rIRA for either my spouse or my IRA up to the limits permitted by tax law. Yes, by electing to contribute to a Roth employee deferral in the employer 401(k) and also to my individual IRA’s I should be eligible for my combined 2024 contributions to exceed 100% of my 2024 earned income. My current income is not so high that I am limited by the current tax rules which can limit deductible tIRAs or keep me from making a rIRA if I so choose to do so. Higher taxable income taxpayers could be subject to limitations or being excluded by their income from making such IRA contributions. The down side is I will then have one more financial retirement account to deal with in the future, a compliance issue I am currently willing to do.
As I am past age 59 1/2 and have had my Roth IRA for over five years any current contribution to my Roth IRA is not subject to an additional 5 year withdraw limitation as is the case with the separate 5 year rule with a tIRA to Roth conversion. I believe I will have then added to my tax free Roth investment base with no additional withdraw restrictions or additional conversion record keeping requirements.
Best of all I am fortunate that when my circumstances change I can just hand in my key to the office and go on with life. Just the knowledge that I could do so, although unlikely absent a major life changing event, is sweet to me.
If you’re over 59.5 and have a 5 year old Roth, there is no additional 5 year withdraw limitation for tIRA to Roth conversions.
My understanding of the five year conversion limitation Roth rules are different than yours. I think a good read on the topic can be found in the following link.
https://www.investopedia.com/retirement/tax-treatment-roth-ira-distributions/
Yes, after age 59.5 you are not subject to the 10% penalty under section 72(t) as being age 59.5 or older is one of a number of exceptions to that penalty for taking a Roth distribution that is not a qualified distribution.
The rules enforced by the IRS for Roth distributions has a ordering tracking compliance requirement. Roth contributions come out first, then Roth conversions and then Roth earnings. If I take a Roth distribution that includes Roth earnings and that distribution occurs before the five year Roth conversion period ends then part of that non-qualified distribution would be taxable to me as I understand the rules. I am over age 59.5 so I would not be subject to the additional penalty. I expect the record keeping compliance headache could exceed the possible tax cost for me.
My goal is to keep my tax records as simple as possible and having to track every Roth contribution, conversion, earnings and distribution for my lifetime and then possibility shifting that burden to my spouse and/or heirs is something I am trying to avoid. Thus far my Roth is composed entirely of Roth contributions and related earnings and my first Roth contribution was over five years ago. By continuing to have earned income and contributing to a Roth I hope to avoid additional complexity.
Our friends in congress created this compliance nightmare. I hope they will find a reasonable solution, maybe in my lifetime?
I’ve seen that Investopedia piece before and it is ambiguous. You need to check the IRS website. I cited it below in my reply to Jonathan. Each conversion starts a 5 year clock, but no clock applies to those who are over 59.5 AND contributed to any Roth at least 5 years ago. So if you opened your 1st Roth when you were 57 the 5 year rule isn’t met until you are 62. But if you are 59.5 and have had a Roth for 5 years NO 5 year rule applies to you for conversions and the 5 year timer is just theoretical.
The entire reason for the 5 year rule is so people can’t withdraw early and avoid an early withdrawal penalty. There is no other reason for the 5 year rule.
I’m not sure you’re correct. You might check this piece:
https://humbledollar.com/2020/05/give-me-five/
I don’t see the piece as contracting what I said, which is just my interpretation of the IRS text I cited.
From that piece you linked:
“To avoid both income taxes and tax penalties on your Roth’s investment gains, you can’t withdraw these earnings until you meet the five-year requirement—and you typically have to be over age 59½.
What if you are indeed over 59½? You won’t be charged the 10% tax penalty. But you could still get hit with income taxes if it’s been less than five years.”
I think that is exactly right. The ‘and’ could have been in italics or all caps for emphasis. Being over 59.5 doesn’t mean the 5 year rule doesn’t apply, since if you haven’t had a Roth open it would still apply. But the thing is the IRS treats all your Roth IRAs as if it were one account. Therefore the oldest one is the one that starts the relevant 5 year counter.
The language is slightly ambiguous. Yes, the 5 year rule applies to conversions. But not without exceptions, the most notable being it doesn’t apply in any way if you’ve contributed to any Roth at least 5 years ago and you’re over 59.5.
This issue has been fully hashed out at Bogleheads.
https://www.bogleheads.org/forum/viewtopic.php?t=401615
Someone helpfully made a chart of all the possible conditions here:
https://www.bogleheads.org/wiki/Roth_IRA#Notes
Possible get a source for this? Like Jonathan, I always thought each conversion has its own clock. The folks at Vanguard weren’t able to answer definitively either, so we now have a ladder of Roth conversions, which is tedious.
I may be wrong, but I believe that each Roth conversion starts a five-year clock for the sum involved.
Each Roth conversions starts a 5 year clock, but there are *exceptions* to the clock. The entire purpose of the 5 year clock is to make sure people can’t withdraw early without penalty. From the IRS website:
Withdrawals from a Roth IRA or designated Roth account, including earnings, will be tax-free if you:
https://www.irs.gov/retirement-plans/rollover-to-a-roth-ira-or-a-designated-roth-account
I’m with Michael1, this article lists all the upsides and none of the equally consequential downsides.
No mention of age discrimination. The company I worked for was actively easing out employees in their 50s, never mind 60s and 70s, and good luck getting another job in my field at that age.
Those “friends” at work are almost all acquaintances, not friends. Would you call one of them at 3:00 in the morning when you needed a ride to the emergency room?
You don’t need a job for life-long learning. Try Great Courses (check out Wondrium) or OLLI at a local university.
You don’t need a paying gig to feel productive. Try volunteering.
I did do part-time contract work for a few years after retiring from my full time job, but then I realized I was much happier not working.
“Picture this: engaging conversations by the water cooler, team lunches, and the camaraderie of working toward a common goal.” Rose-colored glasses at work!
Quite the generalization to say “those ‘friends’ at work are almost all acquaintances.” I’m sure that was your experience, but it’s not universal. I worked with some folks for decades and continue to have lots of interactions with many of them outside of work. After spending 8 or more hours a day with people for years on end, it’s not shocking that some of them become true friends.
Whoa, I detect quite an edge to this response. I must say it bewilders me.
Everybody makes different choices. It’s great that yours worked out for you. Is it necessary to be derisive towards the choices made by others?
Personally I opted for Dan’s model but also incorporated elements cited in your response — I created my own new gig, I volunteer twice a week, I have deep friendships that began at work, and I can laugh when I trip over the water cooler that my wife installed in our kitchen.
And today I’m planting roses… presumably wearing rose-colored glasses.
It was not intended to be derisive, sorry if it sounded that way. I was trying to point out that it is a fortunate few who are in the author’s position.
Your comment about friends vs acquaintances wasn’t derisive or edgy. No worries about that. But I disagree with it nonetheless. I used to make this distinction, but as I got older I saw it was a romantic or idealistic outlook. The older I get the more I value acquaintances and see how others do too. The romantic aspect is how being dismissive of acquaintances IMO treats love as a function of time. The song Cats in the Cradle did more to set that in the popular mind than anything. Lyrics written by Chapin’s wife with a history of broken relationships. Maybe not the person to be taking relationship advice from. I think this idea that love is a function of time is misguided. For my money for a realistic outlook on love and time I’ll take Jim Croce’s Time in a Bottle any day. There’s never enough time, and you can’t save it.
I realize that working in retirement isn’t for everybody. But it seems like folks who are fully retired get offended by the notion that others would like to keep working. We’re talking personal finance here: What works for each of us is personal — and we shouldn’t sit in judgment of those who make different choices, assuming their decisions aren’t downright foolish!
I think the visceral/allergic reaction isn’t about judging but rather a sign that for workers in some industries or at some employers, the lived experience is very opposite of the ideals presented in this piece. God bless those lucky readers who hold happy memories of all their working years and would gladly return. Like mytimetotravel, that won’t be me. Nor do I need a workplace to stay sharp, find purpose or connect with those I love who really love spending time with me.
Of course, it works out well for some people, but this article gave only one side. I suspect that there are far more people who can’t wait to stop working, but agree that they probably don’t read HumbleDollar.
I also don’t think that the “picture this” description fits most people’s working life.
I’m conflicted. On one hand I do miss the interactions with coworkers and customer/clients, but on the other hand I can’t imagine committing myself to show up at work. Perhaps when I run out of projects here at home I will have a change of heart.
This article is so timely. My wife retired a couple of months ago. She hated it because she felt like she had lost the only friends she had for thirty years and her other friends are still busy working. She has always enjoyed baking Birthday cakes for our grandkids but they are getting older and don’t have parties anymore.
I’d come home from work everyday and she’s be sitting on the couch bored and unhappy, until yesterday. When I walked into the house she was smiling and chipper. She had gone to meet a friend at the Gateway Arts Council in town. My wife is not a an “artist” per say but she helped them create brochures for an event using her knowledge of colors schemes and palettes. She now has a feeling if purpose doing something she never thought she would have it even could have done.
I encourage all retirees to try new things and challenge yourselves to bring out talents and abilities you might not know you have
Happy your wife found fulfillment in retirement.
No doubt most if not all of the observations in the article are true, and bear thinking about when considering the jump. But it’s definitely a glass more than half full view of continuing to work.
“Picture this: engaging conversations by the water cooler, team lunches, and the camaraderie of working toward a common goal.”
Now picture this: commuting, pointless meetings, office politics, micromanagement, jerks you can’t just choose to avoid.
That’s just off the top of my head, and from someone who enjoyed their career(s).
On balance, and 2+ years into retirement, I’ll take retirement any day.
Good things to consider when thinking of doing it though.
Good strategy for many people. One key for many is flexibility when working. To enjoy you need more than two weeks vacation a year for sure.
Thanks for the interesting article Dan. I consulted for a number of years, and enjoyed many of the benefits you mention. One of my goals in retirement was to exercise more autonomy over my schedule. Like many of the HD community, my career was exciting but stressful, with lots of deadlines and travel. Consulting in retirement meant more of that. When they needed you, they needed you full-time. When you’re done, get off the payroll. The flexibility I hoped for wasn’t really there. I had to accept that if I wanted the work. Perhaps if I looked at other industry it may have been easier, but staying in my field was the most remunerative. I had talked with colleagues who had retired before me and gone down the consulting road, so I was pretty well prepared. Retirees who want to work need to be honest with themselves about their schedules and what they are willing to accept.