Working after retirement: Get ready for your second act

By Jason R. Friday, CFP®, MPAS®, RICP®, CMFC Head of Financial Planning

As Head of Financial Planning, Jason is a strategic partner who is responsible for developing the strategy, managing the planner teams, and coordinating personal financial planning activities across Citizens Wealth Management to help clients navigate and grow in changing circumstances.

Retirement can be more than the time for traveling the world and relaxing with the grandkids. Once the curtain has fallen on the first act of your career, you may be ready to launch Act II.

If you're officially retired but still want to work, you're not alone. A 2023 study by the Pew Research Center revealed that nearly 20% of adults older than 65 were employed in 2019, nearly twice as many as were working three decades ago.

People decide to keep working after retirement for many reasons, from staying active in their communities to maintaining a steady income stream. Take a look at the pros and cons of continuing to work before deciding whether it's the right call for you.

Benefits of working after retirement

Continuing to work after retirement means more money in your pocket, but that's far from the only benefit of staying employed. Some other advantages of working include:

• Skill development. Never stop learning. Whether you get a job in an office, start your own company or find work in retail, you'll develop new skills.
• Continued engagement. Not every retired person can afford to see the world or participate in unlimited social activities. Continuing to work, even part-time, allows you to continue to engage with your community and make social and professional connections with those around you.
• Passion. When you were growing up, your family might have encouraged you to pursue accounting rather than art for a steady career. Now you have the time to do what you love, whether that's teaching art to others, leading tours at a local museum or selling your creations on Etsy.
• Extra income. If you're eyeing your retirement savings with concern, maintaining a regular source of income can help you feel more comfortable and secure.

Challenges of working after retirement

You might have looked forward to retirement as a time to do whatever you want. While maintaining some form of employment can fall under the "do whatever you want" umbrella, it does put some limitations on you. You may have some difficulty adjusting to working again, especially if you have been retired for a while already.

Another challenge may be finding a job that works for you. Not every employer wants to hire people on a part-time basis, and being self-employed means you're responsible for finding your clients and marketing yourself.

There are also taxes to consider and the potential impact earning an income will have on your Social Security benefits if you're younger than full retirement age.

How to find your second-act career in retirement

You're ready to jump into your second-act career, but one thing remains — deciding what your new act will be.

Second-act career changes are about finding more excitement and fulfillment. Going to "work" every day should be a joy, not a burden.

You don't have to start from scratch in retirement or complete additional training unless you want to. Think about how your existing skills can transfer to a new role. If you had a successful career in accounting and enjoyed the work, consider using those skills to help a nonprofit balance its budget and, in turn, better help people.

Teaching can be another way to give back and pass on your accumulated knowledge. Plus, some teaching jobs give you the flexibility to choose a class schedule that best fits into your life.

You have more flexibility in retirement to play around and see what type of work suits you. If you don't like it, you can easily try something else. You may even try out for an internship, assuming applicants aren't limited to college students or recent graduates.

How to decide whether working after retirement is right for you

Your retirement is yours to spend as you see fit. So, is working the right choice? It all depends on your budget, your social obligations, your health and your interests. Ask yourself a few questions to see whether heading back to the workforce is a good pick.

• Financial. Are you worried about running out of money? Can you find a post-retirement job that pays enough?
• Energy levels. Do you feel up to working? Do you still have the good health and energy to get to work regularly?
• Time commitment. Do you have a lot of volunteer commitments or other obligations, which would make fitting in time to work a challenge? Can you find flexible or part-time work?
• Your hobbies. Do you want to monetize a hobby?
• Your family. How do your loved ones feel about your continuing to work? Do you have family commitments that would make working a challenge?

Be ready for an encore career

Working in retirement can help you stay engaged with your community and bring in an income. If you want to stay active and pursue a passion, finding a job or becoming self-employed can be the right choice for you.

Looking for more advice on how to prepare for your retirement? A Citizens Wealth Advisor can help. Follow the link below to request a call today.

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