• additional income (74 percent of retirees, 87 percent of pre-retirees)
• to preserve or build up assets (59 percent of retirees, 80 percent of pre-retirees)
• to keep employee benefits (33 percent of retirees currently working in retirement, 61 percent of pre-retirees).

“Current trends in retirement indicate that people may need to work longer than they originally planned,” said actuary and retirement expert Carol Bogosian, ASA. “Individuals often have a difficult time estimating how long they can expect to live, how much they will earn on their investments and how much they can spend each year to avoid running out of money. In fact, many people are just guessing about how much money they will need in retirement.” 

While many pre-retirees are planning to work in retirement, those who eventually expect to retire think they will work longer than current retirees actually did. While half of retirees report they retired before age 60 (51 percent), just one in 10 pre-retirees think they will retire that early (12 percent). Instead, half of pre-retirees expecting to retire say they will wait at least until age 65 to do so.

“There is a big gap in the age at which pre-retirees expect to retire and actual retirement ages of those who have retired from their primary occupation,” Bogosian said.“This may be partially due to involuntary retirement and health problems. This gap, together with the failure of many people to plan for a long enough retirement period, may indicate significant future financial problems for many.”

The survey also indicated that many do not appear to understand the benefits of delaying retirement, which may be an important financial strategy for those who do not have enough resources, according to Bogosian. 

In addition to financial aspects of working in retirement, the report also highlights data surrounding the type of work retirees choose to do, including:

• 50 percent of retirees who work in retirement find employment with a company other than the one that employed them pre-retirement, while only 29 percent report working for the same company as before retirement.
• 40 percent say they used entirely different skills in their post-retirement employment, while 39 percent of pre-retirees also plan to rely on other skills.
• 22 percent of retirees working in retirement indicate they started a small business or became self-employed when they retired. Similarly, 31 percent of pre-retirees who plan to retire say they will start a small business.

For a full copy of the SOA's longevity and working in retirement report, please click here.

Photo: View of Lutheran Senior Services' Meramec Bluffs Retirement Community, Ballwin, MO

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