Retirement used to mean one thing: you worked until 65, got a gold watch, and never set foot in an office again. But times have changed. Today’s retirees are rewriting the script, and many are discovering that retirement doesn’t have to mean the end of earning an income. In fact, it might mean the beginning of the most fulfilling work chapter of their lives.
The idea of working in retirement might sound like an oxymoron, but it’s becoming the new normal. Whether driven by financial necessity, personal fulfillment, or simply the desire to stay active, more people are choosing to blend work with their retirement years. This shift opens up possibilities that previous generations never considered, and for people without children, it can be an especially attractive option.
The Growing Trend of Working in Retirement
The Numbers Tell the Story
The statistics around working in retirement paint a clear picture of changing attitudes. Almost half (46%) of Americans between the ages of 60-75 say they plan to work part-time in retirement, according to recent surveys. This is becoming a reality. Currently, about 23% of Americans ages 65-74 are still in the workforce, and these numbers continue to grow.
What’s driving this trend? Life expectancy has increased, with the average 65-year-old man expected to live to 82.5 years and women to more than 85 years. That means retirement could last 20-30 years, which is longer than many people’s entire careers. The idea of sitting idle for three decades doesn’t appeal to everyone, especially when you’re still healthy and energetic.
Beyond Financial Necessity
While some people work in retirement because they need the money, that’s not the only reason. More than half of workers (59%) plan to work in retirement, and many cite reasons beyond pure financial need. Some want to stay mentally sharp, others crave social interaction, and many simply enjoy the sense of purpose that work provides.
For people without children, working in retirement can be particularly appealing because you have more flexibility in your choices. You don’t need to worry about being available for grandchildren or family obligations, which means you can pursue work opportunities that truly interest you.
Financial Benefits of Part-Time Work
Protecting Your Retirement Savings
One of the biggest advantages of working part-time in retirement is that it can help preserve your nest egg. When you’re earning income from work, you don’t need to withdraw as much from your retirement accounts. This can be especially valuable during market downturns when your investments might be struggling.
Social Security Strategies
Working in retirement can also impact your Social Security benefits in positive ways. If you delay claiming Social Security until age 70, your monthly benefits increase through delayed retirement credits. Working part-time might make it easier to wait for those larger payments.
Once you reach full retirement age (between 66 and 67, depending on when you were born), you can work and collect Social Security without any reduction in benefits. This means your part-time income comes on top of your full Social Security payments, providing a nice boost to your monthly cash flow.
Tax Considerations
Part-time work in retirement does come with tax implications. Your wages will be subject to income tax, and if you’re collecting Social Security, up to 85% of those benefits might become taxable depending on your total income. However, many people find that the extra income more than makes up for the additional taxes.
You’ll also want to consider how part-time work affects your Medicare premiums. Higher income can lead to increased Medicare Part B and Part D premiums, though this typically only affects higher earners.
Emotional and Social Benefits
Maintaining Purpose and Identity
Retirement can be a major identity shift. After decades of defining yourself by your career, suddenly having no professional role can feel disorienting. Part-time work can help ease this transition by providing continued purpose and structure to your days.
Many retirees find that they miss the routine, challenges, and sense of accomplishment that work provided. A part-time job can fill this gap while still allowing plenty of time for leisure activities and personal pursuits.
Social Connections and Mental Health
Work provides natural social interaction, which becomes increasingly important as we age. Post-retirement work has been linked to improved health and lower rates of depression. The social outlet that comes from working with others can be just as valuable as the paycheck.
Intellectual Stimulation
Staying mentally active is crucial for healthy aging. Part-time work can provide the mental challenges that keep your brain sharp and engaged. Whether you’re solving problems, learning new skills, or interacting with customers, work can provide the intellectual stimulation that might be missing from a purely leisure-focused retirement.
Types of Part-Time Work Options
Consulting in Your Field
Many retirees find success as consultants in their former field. You get to use your years of experience and expertise while working on your own terms. Consulting often offers flexibility in terms of schedule and workload, making it ideal for retirement. The key to successful consulting is leveraging the knowledge and relationships you built during your career.
Seasonal Work
Seasonal employment can be perfect for retirees who want to work part of the year and have complete freedom the rest of the time. Retail positions during holiday seasons, tax preparation during tax season, or tourism-related jobs in vacation destinations are all popular options.
Remote Work Opportunities
The shift toward remote work has opened up new possibilities for retirees. You can work from anywhere, which is particularly appealing if you want to split time between different locations or travel extensively.
Passion Projects Turned Profitable
Retirement can be the perfect time to turn hobbies into income streams. Whether it’s crafting, photography, gardening, or any other interest you’ve developed over the years, there might be ways to monetize these activities.
Potential Challenges to Consider
Health Insurance Considerations
If you retire before age 65, health insurance can be a major concern. Some part-time employers offer health benefits, but many don’t. You’ll need to factor the cost of private health insurance into your decision-making process.
Once you’re eligible for Medicare, this becomes less of an issue, though you should still understand how your work income might affect your Medicare premiums.
Impact on Retirement Account Withdrawals
If you’re taking required minimum distributions (RMDs) from retirement accounts, you’ll need to continue doing so even if you’re working. The additional income from work might push you into a higher tax bracket, which could affect the overall tax impact of your RMDs.
Finding the Right Balance
The key to successful part-time work in retirement is finding the right balance. You want enough work to provide the benefits you’re seeking, whether financial, social, or emotional, without overwhelming your retirement lifestyle.
Some retirees make the mistake of taking on too much work and ending up more stressed than they were before retirement. It’s important to be honest about what you want from this experience and choose opportunities accordingly.
Work With Us
Part-time work in retirement isn’t right for everyone, but for many people, it offers the perfect blend of financial freedom, personal fulfillment, and social engagement. The key is approaching it thoughtfully and choosing opportunities that align with your retirement goals and lifestyle preferences. Whether you’re motivated by financial necessity or personal satisfaction, part-time work can enhance rather than detract from your retirement experience when done right.
At Purposeful Wealth Advisors, we understand that retirement planning extends beyond just accumulating savings—it’s about creating a lifestyle that works for your unique situation and goals. If you’re considering part-time work in retirement, we can help you understand the financial implications and develop strategies that maximize the benefits while minimizing potential drawbacks. Contact us today to discuss how part-time work might fit into your comprehensive retirement plan and ensure that your golden years are both financially secure and personally fulfilling.
