Should I Work in Retirement?

You may be near retirement age, but are you ready to retire? Back in the day, retirement meant leaving a steady job, drawing a pension and "riding off into the sunset." However, we can all agree that times have changed.

Nowadays, the percentage of American workers age 65 and older has increased from 12.5% to 18.8%.¹ And while some people are working longer into retirement due to increased life expectancy, others may retire earlier than planned due to unexpected health issues or circumstances.

That's why it's important to consider both the financial and emotional consequences when deciding whether or not to continue working in retirement.

Financially: Are you where you need to be?

• It may make sense to put off taking distributions from your retirement plan. Why? So you can (1) save longer and (2) benefit from more compound interest.
• If you are under age 70, you can delay taking Social Security in order to earn delayed retirement credits (e.g., an 8% increase in benefits for each year you delay past full retirement age, up to age 70).
• If you work past age 73, there may also be an opportunity to delay IRS-imposed required minimum distributions from retirement plans. This may ultimately provide a more secure retirement in the long run.

Emotionally: Continuing to work can stimulate some but discourage others.

• Pray for wisdom and guidance as you begin this new chapter in your life.
• Ask yourself, "What makes me fulfilled? Is it continuing to work, perhaps part time, or would I prefer to cut the cord and focus on other things?"
• If your budget and schedule allow, consider volunteering at your church or a local ministry. Serving others could be a blessing to them — and you.

Everyone has a different view of what a satisfying retirement looks like. But with a little preparation and prayer, you can create a plan that works for you and your wallet. You can also utilize our Personalized Retirement Planner to get a better picture of your preparedness for this upcoming season.

¹Bureau of Labor Statistics