Why Healthier Retirees Reject “Off-the-Shelf” Retirement and Seek to “Do Something”

The below article was written by Christoper Carosa, CTFA on July 8, 2014 and originally published on FiduciaryNews.com.

On the other hand, some people do work during retirement because it’s the only thing they’ve ever done. “Some people don’t know how to retire. They have developed a passion or desire to do something once retirement has come. Additionally, the folks working that do not really need to be working, feel as though they will never have enough,” says Matt Jehn, Managing Partner at Royal Oak Financial Group in Columbus, Ohio.

We should keep in mind the changing demographics of retirement as more and more baby boomers enter their golden years. “Today’s retiree is healthier and wants to keep mentally active so many start their dream business turning their passion or hobby into a part-time Retirement Business,” says Joseph Leonard of Best Ideas for Retirement Businesses in Seattle, Washington.

“People are living longer, healthier lives. This means many people have at least 15-20 years after they retire,” says Nancy Collamer of Old Greenwich, Connecticut, the founder of MyLifestyleCareer.com and author of the book Second-Act Careers. “What are they going to do to fill that time and how will they make their money last? Working allows them to supplement their income, while infusing their days with meaning, structure and a routine. Working in retirement is very different from working full-time – most people pursue flexible, entrepreneurial, seasonal and/or part-time options, rather than full-time employment.”

It’s not surprising that the most coddled generation in history – the me generation – won’t submit to any off-the-shelf definition of retirement. “Retirement is different for each individual,” says Pamela J. Sams, Chartered Retirement Planning Counselor at Jackson Sams Financial Services in Herndon, Virginia. “The ‘rocking chair on the porch passing the time away’ is not everyone’s vision of retirement. People often plan for the financials of retirement but not the lifestyle. A lot of retirees continue to work not because they need the income but because they are bored. Getting out of the house and working gives them a sense of purpose and gives them something to do.”

Imagine the psychological impact of suddenly being taken from a community you’ve lived in eight hours a day, sometimes for decades on end. Richard Sturm, a financial adviser, educator and public speaker in Seal Beach, California says, “For some, the idea of retirement sounds good in theory, but in practice can be lonely – especially for widowed or other single individuals. Part-time work provides an outlet for seniors to continue contributing. Other seniors find that part-time work helps keep their cognitive skills sharp.”

Rachele Bouchand, Director of Financial Planning at Clark Nuber in Bellevue, Washington, says, “About a quarter of my clients continue to earn outside income during their retirement years. This income is usually from board participation or working for a Not-For-Profit institution that they’re passionate about. I don’t have many clients that ‘need’ to do this. The reason why many of my clients continue to work part-time is because they want to continue being involved in their local community and it gives them intellectual stimulation. The bottom line is that these positions are optional for them and make them happy. They choose these organizations and know that they can leave if they need to.”

Don’t understate the need to “do something,” especially for successful people. One financial adviser, who didn’t leave his name, told FiduciaryNews.com “More typical is the client who has more than $2 million invested with me but after a busy and successful work life, found retirement too boring to do the more mundane retirement activities. Since he enjoyed golf, he purchased the management contract at a nearby public golf course. He is again challenged to turn around the management and earn a profit running the course.”

This definition of “success” in not limited to millionaires. For many, there remains a psychological drive to seek and obtain rewards. It’s why gamification has become a popular motivational tool. It also explains why today’s retirement is not your grandfather’s retirement.