6/21/2013 6:30 PM ET|
Make the most of semi-retirement
There’s no rule that says retirement has to be a destination. As many people are now proving, it can also be a great chance at a fresh beginning.
Some people call it "phased retirement." Others refer to it as "semi-retirement." Essentially, it means working part-time in a job that’s different from your previous career. And it’s not uncommon. A recent CareerBuilder survey found that 60% of workers older than 60 plan to look for new jobs after retiring.
Intrigued? So were we, which is why we sat down with Nancy Collamer, the author of “Second Act Careers: 50+ Ways to Profit from Your Passions During Semi-Retirement,” to find out more about how people can make the most of this new trend.
LearnVest: What inspired you to write about semi-retirement careers?
Collamer: Despite the fact that we’d always done what the experts had advised -- living below our means, maximizing our 401k contributions, etc. -- my husband and I learned that, under certain circumstances (like the 2008 financial crisis), we could conceivably run out of money in our later years.
I’d also been a career coach for over 15 years, and my specialty was flexible work -- generating income by using your skills and talents on a part-time basis. When I looked at what was being generally recommended for Boomers, I was seeing one of two lines of thinking: Either the “buy a vineyard, and live off the land” type of dream -- not realistic for most folks! -- or the “be an usher at a movie theater/greeter at Wal-Mart” advice. There are so many other things that people could be doing to generate additional income during retirement, so the book was born.
I’d also been a career coach for over 15 years, and my specialty was flexible work -- generating income by using your skills and talents on a part-time basis. When I looked at what was being generally recommended for boomers, I was seeing one of two lines of thinking: either the “buy a vineyard, and live off the land” type of dream -- not realistic for most folks! -- or the “be an usher at a movie theater/greeter at Wal-Mart” advice. There are so many other things that people could be doing to generate additional income during retirement, so the book was born.
Do certain traits make you more likely to succeed at semi-retirement?
As a therapist once explained to me, fear is often just an acronym for “false evidence appearing real.” What I discovered in the more successful “second act-ers” was that they didn’t let fear stop them from moving forward. Instead, they overcame it by taking small steps, such as gaining added skills and knowledge, which gave them the confidence to overcome their fears. One of the challenges with a second-act career is that you sometimes have to take a step backwards, so another trait would be a willingness to ask for help, while recognizing that risk -- and failure -- is part of the process.
When is the best time to start thinking about semi-retirement?
Ideally, I’d say three to five years before you’re getting ready to retire is a great time to begin the process. This may seem like an overly long timeframe, but the reality is that the more time you allow, the more flexibility you’ll have to explore, research, test and refine your plan.
It’s also important to keep in mind that it may be a while until you can generate income via a new career. So the more time that you allow yourself to save money, the more flexibility you’ll have to retool and retrain when you’re ready to transition. Also, if you start thinking about what you want to do while you’re still employed, you may be able to take advantage of employee-sponsored training programs, workshops and conferences -- helping you get that new career off the ground.
Are there specific industries that are more receptive to semi-retired workers?
Any sector where age -- and with it experience, maturity and a strong work ethic -- can play in your favor will be more receptive. The health care industry would qualify. Education, to some degree, is another one: A teacher who brings 25 years of life experience to the table can be helpful. I’ve devoted a full chapter to identifying these industries, but the main thing is to remember that there are many different types of jobs and businesses where your maturity, contacts, accomplishments and range of experiences will be attractive to a lot of clients.
What are your top three tips for people looking to do this?
Invest in your success. You need to recognize that the process is going to take time and money, but also keep in mind that the second act could easily last for 20 years. Think about what you spent on your last vacation, and put a tiny portion of that into your own personal investment fund to provide a cushion for this transition.
Surround yourself with support. Reaching out to family, friends and professional contacts is an effective way to learn about ideas and opportunities. There’s no bigger dream-killer than isolation.
Focus less on finding a job and more on filling a need. Many of the opportunities aren’t necessarily things that you’ll find in a job listing; they’re things you’ll create on your own and project work you’ll do for others. The latest statistics show that about a third of Americans are working in something other than a full-time job -- they’re working part-time, freelance, consulting and running their own businesses. It’s very clear that, over time, those numbers are going to increase.
Any other parting words of advice or encouragement?
Think big, but act small. Start by creating a big picture of what you want your life to look like in semi-retirement, and then take small actions on a regular basis to build that dream -- signing up for a workshop, taking a class, brainstorming with friends. Regular small actions over time add up to big change.
More from LearnVest:
VIDEO ON MSN MONEY
I retired after working 39 years for the same financial institution. After 6 monthe off, I am ready to go back to work part time. That is what I want to do, but if someone wants to retire, can retire without financial worries then I say go for it. Even though "they" say "we" are now living longer, as an individule, we do not know how much longer we have got to spend our days not having to punch a time clock so to speak. I would love to jump in the car and travel until I am ready to come home not because my money ran out and I want to be able to do this healthy and mobile. Even people who have always taken care of themselves do not know if dementia or alzheimers or cancer or someother illness or disease will pop up unexpectedly and prevent us from enjoying the time we have alloted ourselves in retirement. Part time work is a way to straddle both worlds with a few consessions like shorter trips.
I have been retired for 3 years now. I retired at 62. I love to listen to these big income advisert that tell you to retire at 70 or 80 or just before you kick the bucket. Common people that worked hard for a living with no state of federal employment should get out at 62. These money grubbing dumpster pigs called retirement advisers just want to suck your money out of your pocket and bank account. I worked like 70% of Americans workers do. A life time of low wage jobs with, no unions, no pension, very little savings and never made enough money to save anything. People like us lived from pay check to pay check, long term unemployment and no insurance or CD's to cash in when times were very hard. These money advisers love to talk about people that retire with a million or two or three but, for us that's is just BS. Do your self a favor and get out at 62 and work part time if you need to. You worked all your life with no help from anyone, get your SSI at 62 and get some rest and enjoy your self. Get your Social Security money back, don't let those millionaires get your hard earned money. 62 and done. Take your money at 62 and live a little, you deserve it!
It looks like I'm being forced into early retirement. I quite my position at a company because of it's unreasonable and toxic work environment. My wife and I planned my departure and put in place a financial cushion that would last a year. I figured, at first, that I would simply find another job. But, after dozens of online application with no responses I am forced to think about my own consulting company. So, I am following that avenue. The timing is perfect as this is something I was planning on doing part time after my official retirement at 66. Laying the foundations now and establishing myself is perfect timing. And, I'm going to school to enhance an already good drafting skill.
I find that this article describes my situation perfectly. And I am reassured that the steps I have been instinctively following thus far mirror almost exactly what the author recommends.
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
Some workers lose up to a quarter of their paychecks paying off old debt from credit cards, medical bills and student loans, as well as child support.