When you think of retirement, do you imagine lolling on a far-off beach or maybe curling up with the latest novel? Since retirement is lasting longer than ever, many retirees don’t relish the idea of 30 years of leisure—or believe it is financially sustainable. About half of today’s workers say that they plan to work after they retire, according to a recent report from the Society of Actuaries.1
“They don’t want to be on the front porch swing; they want to stay busy,” says Ryan Young, a Bradenton, Florida-based financial advisor for SunTrust Investment Services.
Consider this an opportunity to try your hand at an encore career—a term used to describe a second work life that combines personal and social meaning—and a paycheck. Here are a few of the benefits you can expect if you decide to launch a second career.
1. A bigger bank account
Money will play a key role in your decision whether to continue to work during retirement. Review your situation to see if you have enough income to support yourself for three decades of retirement. (Don’t forget to factor in inflation!) If you might fall short, working in retirement could be the best way to generate the extra income you need to close your gap.
A retirement job also means you can decrease or even discontinue withdrawals from your retirement investments, giving them the opportunity for potential growth. “We talk about Social Security, pensions and investment accounts as the three legs of the stool when it comes to retirement,” says Young. “For many, a second career becomes the fourth leg to support them.”
2. A new passion or a return to an old one
With a lifetime of experience behind you, you have a lot of wisdom to share with others. An encore career can be an opportunity to give back to your community. Many retirees choose a second career in their field but take on a different role with reduced hours. For instance, Young cites the example of a lawyer who now does part-time mediation.
On the other hand, you may want to change fields entirely. An encore career can be your ticket to a passion you’ve only dreamed about—while also producing some income.
3. Better health
An encore career can be a way to give yourself purpose and keep your mind and body busy. Plenty of research shows that keeping your brain active helps protect against some aspects of cognitive decline as you age. And physical activity—anything that gets you out of your chair—helps maintain strength and stamina. “As a society we’re more mobile than ever,” says Young. “People are used to being active and on the go, and they don’t want to give that up in retirement,” says Young.