Today I’m going to share more thoughts from The Wall Street Journal Complete Retirement Guidebook.
In case you missed the first post in this series, check out Basics of Retirement Planning.
Last time I told you that the book had an eighth question people should ask about retirement that it added to the seven suggested by Ronald Manheimer, executive director of the Center for Creative Retirement at the University of North Carolina in Asheville.
That eighth question is:
How Do You Define “Retirement”?
Hahaha! I love it!
We have talked many times about the changing definition of retirement.
Back in the “old days” (when I was a kid), retirement meant that you stopped working at 65, watched TV and played golf or bowling once a day, and then died a few years later.
Fast forward 50 years and people talk about “working” in “retirement”. Isn’t that an oxymoron? Not these days.
In fact, working (or work-like activities, like volunteering) is often a vital and fulfilling part of retirement. It’s just that in retirement people don’t work for “the man” in order to pay the bills and provide for their families, but they work because they enjoy it, want some sort of challenging activity, like to connect with others through work, or any number of other benefits. The fact that it pays something is simply a pleasant side effect.
This is me with both ESI Money and the Millionaire Money Mentors (MMM). I do them because I enjoy writing and talking about personal finance — it’s an interest for me. Plus both these sites keep my mind active and force me to learn something new each day, which I enjoy. And I socialize in this manner as well, having made several friends among the two sites. In short, I enjoy doing this “work” and it has a lot of worthwhile benefits. The fact that the sites make money is nice, but at this point I’m ok financially with or without this income.
Defining Retirement
We’ll get to what others think about the definition of retirement in a moment. For now, let’s keep going with the book’s thoughts as follows:
Then there’s the word itself: retirement. The Transition Network, a women’s support group in New York, staged a contest to come up with a new name for retirement. (The winning word was “regeneration.”) Residents at an assisted-living center in Chicago petitioned the good folks at Merriam-Webster to expand the definition of retirement in their dictionary; the residents felt the definition was limited to the notion of “withdrawing” from society, when it should include the idea of “engagement.” (There’s that word again.) Clearly, in some circles, retirement is a four-letter word.
Whatever the current or popular image of later life, there is no “right” or “best” retirement. There is only your retirement, one that, ideally, will involve a good amount of planning on your part.
Perhaps the best way to close this chapter is to tell you about those individuals who, from our reporting at the Journal, appear to enjoy later life more than most. They are a group who, through planning, experimentation and a measure of luck, experience what might be called an epiphany: a discovery of their life’s work at the very moment when life could be seen as winding down. It could be the hobby that becomes a full-blown passion or the new interest that first consumes Monday (and then Monday through Friday) or the part-time volunteer work that becomes a full-time mission. Whatever the path, it’s like finding the answer to the question, What do you want to be when you grow up? Some simply find the answer later than others.
Some common threads emerge among those who seem most fulfilled: a continuing search for challenges, a decision to immerse themselves in a wide range of activities and a firm belief that their best years are still ahead of them.
Some thoughts from me:
- In my retirement interviews I always ask: “How do you define retirement?” I do this for a couple reasons. First, I know the definition is changing, so I’m interested in how people define it today. Second, as the book notes above, the definition of retirement is often in the eye of the beholder, so I want to see what people are thinking. The responses make for interesting reading and it’s always one of my favorite parts of those interviews.
- “There is only your retirement, one that, ideally, will involve a good amount of planning on your part.” We talked a lot about planning for retirement in the last post and here it is again (and not for the last time.) I’ll just say once more that it seems worthwhile to plan for a 30-year, multi-million dollar financial event — but maybe that’s just me. 😉
- I love that people are finding work in retirement that they enjoy. So many people dislike their jobs these days that it’s awesome to hear of those who get to do something they are actually excited about.
- “The hobby that becomes a full-blown passion.” This is me and blogging/owning websites. And this is yet another reason to start a side hustle prior to retirement. If you create something you like doing that also makes money, it will allow you to retire sooner (because of the income) and happier (because you’ll be doing something you enjoy for more hours of the day). That sounds like a big win-win to me!
- “Part-time volunteer work that becomes a full-time mission.” I have seen this happen quite a bit as well. People find something they truly believe in while retired and they simply seem to come alive doing it. For some good examples see Awesome Things People Are Doing in Retirement.
- “Some common threads emerge among those who seem most fulfilled: a continuing search for challenges, a decision to immerse themselves in a wide range of activities and a firm belief that their best years are still ahead of them.” In other words, they remain curious (a comment I’ve seen time and again as part of having a great retirement) and they get out there and act on these things. People who fail at retirement suffer from a lack of imagination and interest more than anything else IMO. Those who are interested in things besides work and keep finding new activities to be interested in, never get bored in retirement. You’ll often hear these people say something like, “I don’t know how I had time to work — I’m so busy in retirement.” They are busy with fun things they find interesting!
The book then ends this section with yet another plug for planning for retirement:
When we asked Jack what advice he would offer to a person just entering retirement, he responded this way: Spend as much time thinking about how you might use your days as you do preparing your finances. Retirement could well “represent 25 percent of your life,” he told us. “Why leave it to chance?”
I agree 100% with the sentiment of this thought, but I’d change the question a bit.
Instead of asking “what advice he would offer to a person just entering retirement”, I’d prefer asking “what advice he would offer to a person starting to plan for retirement.”
If you are thinking of what you’ll do in retirement and you’ve already retired, you are very late to the game. You need to consider how you’ll spend your time in retirement well before you take the plunge. And you should try out several activities, finding 4-5 you really like, that you know can help fill your time enjoyably in retirement — all well before you retire.
Working in Retirement
Now the book shifts and dives into working while retired as follows:
Why are so many people suddenly working in retirement?
Several key factors, including increasing life expectancies, the curtailment of traditional pension plans, a jittery stock market and rising health-care costs, account for the change.
But people who do have large enough nest eggs are choosing to work, too–for pleasure. Two-thirds of the 1,700 working retirees whom Putnam interviewed said that they took jobs to help them stay healthy, energetic or mentally fit.
So most people work in retirement for non-financial reasons. Interesting.
Also, look at all the non-financial benefits from working in retirement:
- Increasing life expectancies
- Staying healthy
- Remaining energetic
- Keeping mentally fit
Not a bad list. But there’s more!
In addition to these, working does help provide some margin for safety from financial factors like not having a pension, a jittery stock market, and rising health-care costs.
The book continues:
So, how do you go about deciding for yourself whether to work in retirement? Helen Dennis, a gerontologist in Redondo Beach, California, who specializes in aging, employment and retirement, recommends that you ask yourself these six questions:
1. Do I Need to Keep Working, or Go Back to Work, for the Money?
2. Would Work Make My Retirement More Worthwhile?
3. Would Working in Retirement Help, or Hurt, My Social Life?
4. If I Do Decide to Work, Should I Go Full-Time or Part-Time?
5. How Exactly Would I Go About Finding a Job?
6. What if I Decide Not to Work?
My take on these questions:
- “Do I Need to Keep Working, or Go Back to Work, for the Money?” I do not need to work. I work for the fun/interest/non-financial benefits from it. If I did need to work, I wouldn’t have retired in the first place.
- “Would Work Make My Retirement More Worthwhile?” It does for me. It’s something I enjoy and look forward to doing. FWIW, I enhance my work by making sure I have a great office setting — good computer set-up, sunny (mostly) window nearby, another (smaller) window that I open up to let the fresh air in (and Zeus likes to sit there and watch birds), a cat that lounges in one of the windows/chairs/cat perches I have for him (I like the quiet “company” he provides), instrumental Christmas music playing on Spotify (yes, I listen to it all year around), and a nice cup of coffee. Ahhhhhhh, dreamy!!!!!!!!
- “Would Working in Retirement Help, or Hurt, My Social Life?” Hahahaha. Like I care about this. I get enough people interaction from pickleball, church, and other activities, so I’m ok on the social front without needing work to fill in any gaps. That said, I do have lots of interactions each day with people in the MMM forums and have made quite a few good friends there (some I have met in person).
- “If I Do Decide to Work, Should I Go Full-Time or Part-Time?” I shudder when thinking of working full-time, even for something I love doing, but that may be the solution for some people. In addition to being something I’m interested in, my work is also flexible in time (I can work 8 hours a day or zero — I usually work 1-2 hours a day, FYI), location (as long as I have an internet connection, I can work from home, a coffee shop, a cruise ship, or a beach), and time of day (I can work at 8 am, 7 pm, or 3 am — I mostly work in the mornings/early afternoons between working out and pickleball). It’s this flexibility that makes my work even better than it would be otherwise. FYI, as I write this, it’s the beginning of June, though you won’t be reading it for many months. This is because I’m writing a lot now so I can take most of January-April off when I go to The Villages next winter.
- “How Exactly Would I Go About Finding a Job?” Here’s yet another win for having a side hustle prior to retirement — you can take it with you so you have a portable work situation you enjoy! The next best option I’d recommend is networking with others. I’d do this prior to retiring and see if I could try out any potential jobs on nights/weekends before I actually retired.
- “What if I Decide Not to Work?” No problem. Not everyone (or even most people) needs to work. But there are benefits to working that you’ll need to get elsewhere — like maybe volunteering (which has a very broad definition — you could volunteer as an executive for the Salvation Army or volunteer by watching your grandkids three days a week).
Volunteering in Retirement
The book offers the following tips for those considering volunteer opportunities:
Finding the right place to offer your time and services — even when you’re doing it for free — sometimes requires great effort. “If you want volunteering to be a significant part of your life, then it’s likely going to take some work to figure out the right fit,” said John Gomperts, chief executive of Experience Corps.
Having done this, here’s what I’d recommend:
- Network with others to see what volunteer opportunities there are that seem to fit your interests and skills.
- Interview with the organization to see if it’s a fit for you both.
- If it is a fit (or seems like one, you won’t know for sure at this point), agree to volunteer for a given period of time — like a couple weeks or months. This way, if you hate it for whatever reason, you can leave after that time having fulfilled your commitment with no hard feelings. Just be aware that some of the “better” volunteer opportunities may require a longer/bigger commitment, so you’ll have to balance your flexibility with the opportunities.
- Keep at this until you find something (or a few things) you enjoy and then make whatever commitment feels right for you.
- Do all of this BEFORE you retire if you possibly can. It will help make planning your time in retirement much easier/better.
Now for some finding volunteer opportunities advice from the book:
Here’s the advice we gathered from people who, like Rita, figured out for themselves how to find meaningful volunteer work:
- Find a Cause that Matters to You
- If Need Be, Hire Yourself. If you can’t find a volunteer activity or position that interests you, you may want to consider creating your own.
- Make a Smooth Transition. Yes, it could be fun to try something completely different from your former day job when you first volunteer in retirement. But tapping skills and knowledge from earlier jobs could help you settle into a volunteer role more easily and help you be more effective.
- Put Yourself First. The biggest incentive for volunteering may be what you get from the work: a chance to go behind the scenes at the local theater, pats on the back or friendships with fellow volunteers.
- Find a Place That’s Volunteer-centric. Groups organized to train and put volunteers to work tend to offer more educational opportunities, chances to mingle with fellow recruits, behind-the-scenes access to museums and theaters, social hours and recognition–all of which may rake on increasing importance when volunteer work replaces a career. Something else to watch for is a place that wants to use you efficiently and that can work with you on a flexible schedule. (You’re doing this at no charge, after all.)
- You Have to Start Somewhere. As in the business world, you may start in an “entry-level” volunteer position, but once you get a little experience, it’s fairly easy to work your way up to the duties that you find most rewarding.
- Stay Flexible. Unfortunately, volunteer work can be as fickle as any paid job. Leaders come and go, missions change and budgets expand and shrink. In the end, you might have to try something with. out knowing that it will be the right fit. And you may wind up working with a few different groups to satisfy your goals.
This is some great advice IMO (which they expand upon in the book). Here are some thoughts from me on these:
- “Find a Cause that Matters to You.” This may go without saying, but if you don’t like the cause, volunteering will be way more like a job than “doing good in the world” and that will make a ton of difference in how you feel about what you’re doing.
- “Make a Smooth Transition.” I have always looked for a volunteer opportunity where I could use my work skills and interests and these are the places where I’ve always been happiest. Unfortunately there are limited slots for upper management volunteer slots (since these are generally in-house, filled by employees), which is why I have had to “hire myself.” Yes, I view ESI Money as partly a volunteer opportunity in that I give away free content that hopefully makes people’s financial lives better.
- “Put Yourself First.” If you are not happy, the organization will not be happy. So be sure it works for you first and foremost.
- “Find a Place That’s Volunteer-centric.” Some places really value their volunteers and some are more like a factory churning through volunteer after volunteer. Needless to say, you want the former and not the latter. This is another reason I suggest a short trial run — so you can find out which one of these fits any given organization.
- “You Have to Start Somewhere.” You’re probably not going to be the president of the organization on day 1. But if you are good at the lower levels, you will get noticed and “promoted” to higher-level work. This is how I started out (at the bottom) in every organization and eventually found myself as president, on the board, or having some other high level of responsibility.
- “Stay Flexible.” I have found that leaving your options open is one of the keys to having a great retirement — at least for me. So I 100% agree that you’ll want a volunteer opportunity that’s fairly flexible. After all, you’re giving your free time to them so making it at least somewhat convenient for you seems like a no-brainer.
That’s it for this time. For the next post in this series see Moving to a New Location in Retirement.
I define “retirement” as both financial independence and no longer working for “the man” so to speak. I was able to achieve this at 48 years old (late 2019). After about 2.5 years of living the life of leisure, I went back to work part-time (about 20hrs per week) at a friend’s bike shop doing sales and wrenching on bikes. I get paid so little (no complaints whatsoever though) that it’s darn close to being volunteer work. But, it’s much more enjoyable than the 25 years I spent as a lawyer in big corporate America working 50-60hrs per week).
Personally it annoys me when someone claims they are retired yet they have to work, even if what they get paid is less than their previous income. If you still need the paycheck to any extent, you’re not retired in my book. Yes, it may be for a less stressful job or more enjoyable work, but that’s just a career change.
Being from tech, I like borrow that language to explain post working 60hr/week life, which was Adult Life 1.0. Life 3.0 is when you’re reading in rocking chair and golfing shortly before you need a walker.
I am not retired, I am in Life 2.0. This is where I want to still do some financially gainful work (part time is best) as well as have time to volunteer for all the same reasons discussed above. I have the financial ability to do nothing gainful, but doing so would could create more room in the budget to upgrade our travels (eg, premium class tickets, hire more guides, etc) as well as drink more wine.