What Role Should Work Play in Retirement?
Quitting work early and cold turkey is inadvisable.
Posted Sep 09, 2019
The Cambridge dictionary defines retirement as, “the point at which someone stops working, esp. because of having reached a particular age or because of ill health, or the period in someone’s life after the person has stopped working.” The idea of retirement as the gateway between working and not working is the foundation for how most Americans think about retirement.
The notion of retirement as “stop working” and “not working anymore” is surprisingly pervasive. We call the age at which we stop working the retirement age. We debate about our “number,” the size of the nest egg we will need to retire comfortably.
And most discussions about the “retirement crisis” are not about the health or the well-being of older Americans. They are solely about the fact that a significant number of Americans are not saving enough money for their retirement.
Interestingly, although we take retirement for granted, the concept of stopping work at a certain age goes back only about 130 years. It was introduced by Otto von Bismarck in Germany in 1889 by providing a modest pension to those over the age of 70. Throughout most of human history, people didn’t stop working at a socially-defined age.
In this blog post, I want to consider the role of work in retirement and why the idea of retiring as not working may need to be reconfigured for our times.
Working in later life (past 65) has significant benefits.
The tenet that people should stop working when they turn 65 (or any specific age) is not generally supported by psychological principles or research evidence. There are far too many individual differences for this. And in practical terms, 26.8% of Americans aged 65-74 and 8.4% of those over 75 continue to work today.
This is not a bad thing. There are numerous studies showing that working in later life has significant cognitive, emotional, social, not to mention financial benefits. Perhaps the most significant advantage is that self-determined and self-paced work in one’s sixties, seventies, and eighties, whether for pay or not provides purpose and meaning to one’s life. Work is an essential part of the Japanese concept of Ikigai which means “to have a reason for being.” Cultural psychologists have found that a sense of Ikigai is associated with a lower risk of mortality. For many people, doing work also gives much-needed structure to daily life along with opportunities to socialize. And delaying retirement age changes the financial equation favorably about how much money you will need when you stop working altogether.
Studies by organizational psychologists show that those who transition gradually from full-time work by working part-time or doing volunteer work (engaging in the so-called practice of “bridge employment”) enjoy their retirement more and report being happier. One large-scale study found that among those over the age of 65, those who continued to work had better health and were less likely to fall prey to severe illnesses like cancer or heart disease. Another study went so far as to conclude, “Early retirement may be a risk factor for mortality and prolonged working life may provide survival benefits among US adults.”
From the large body of available research evidence, it is clear that there are significant psychological and health perils to quitting work cold turkey, and there are benefits from continued work. A strong argument can be made that as long as it provides enjoyment and a source of fulfillment, working as one’s 50s turn to 60s, 60s to 70s and even 70s to 80s is a good thing. And quitting work, whenever that decision is made, should occur gradually.
There’s one important caveat.
In considering the role of work in retirement, there is one important caveat to keep in mind. The key to the positive outcomes of work in later life is having autonomy in what work you do and why you do it. (More about this in a future blog post). If you have an insufficient nest egg for retirement (a common occurrence) and have to work to support yourself and your family in your 60s, 70s, and thereafter, these positive outcomes are less likely to occur.
In that case, the forced work may lead to emotional exhaustion, compromised health, and lower your well-being drastically. Similarly, if you are in poor health in later life, and still have to work, all bets are off. There is a massive difference between working for pleasure and to make a difference whether you are getting paid for it or not and working because you have no choice, your financial resources are dwindling, and you don’t have a social network to rely on for support. In these circumstances, working in retirement is burdensome.