7 Million Retirees Return to Work

[REWahoo]

Retired, but not forever
7 million have gone back to work, study reports

12:00 AM CST on Tuesday, December 27, 2005
By BOB MOOS / The Dallas Morning News

"The working retired" may seem like a contradiction, but they're becoming a fact of life.

Seven million retired Americans – about a third of retirees – have returned to work after an average of 1 1/2 years at home, according to a study by Putnam Investments, the Boston-based money management firm.

Though labor analysts have predicted that boomers will work into retirement, the Putnam study of 1,726 older Americans confirms that the trend is already under way among the older so-called Silent Generation.

"We're surprised at the number," said Beth Segers, director of market planning and development for Putnam.

"Retirement isn't a once-in-a-lifetime event anymore," she said. "It's a break before going off and doing something new."

Ms. Segers said the survey found that many retirees return to the workforce for monetary reasons.

They either have substantial financial obligations late in life or are unwilling to scale back their consumption during retirement.

The Putnam study described the average "working retired" person as a 61-year-old man with a four-year college degree or better, a household income of $86,800, investable assets of $406,000 and a home mortgage.

"The overall profile of the working retired is sharply upscale," Ms. Segers said. "But our survey also uncovered some significant differences within the 7 million Americans who have climbed out of their easy chairs."

About two-thirds of the working retired said they wanted to go back to work.

Many thought a job would keep them healthy or energetic, while others were looking for a paycheck to cover extras like travel and gifts.

The remaining third of the "unretired" said they had to return to work. The need to supplement retirement income was cited as a major reason, but health insurance also figured prominently.

"There's a nervous stretch of retirement south of age 65, before someone qualifies for Medicare," Ms. Segers said. "Early retirees may need to work not only for the income but also for the health insurance."

The Putnam study found that more than half of the "unretired" took part-time jobs that weren't as stressful as their previous careers, though the new jobs often required the same skills and experience as the old ones.

Older job seekers complain they frequently face age discrimination. But Ms. Segers said the survey showed how older workers with good credentials and strong networks of associates can get hired.

The working retired may take it easy one day, but not soon. Many of the survey's respondents expect to remain on the job into their 70s or until health reasons force them to quit.

Originally Posted by REWahoo!

Retired, but not forever
7 million have gone back to work, study reports

"Retirement isn't a once-in-a-lifetime event anymore," she said. "It's a break before going off and doing something new."

Worst case -- "something new" is the WalMart greeter job

[Eagle43]

Originally Posted by REWahoo!

[size=11pt][b]The Putnam study described the average "working retired" person as a 61-year-old man with a four-year college degree or better, a household income of $86,800, investable assets of $406,000 and a home mortgage.

Well, with a hh income of 86k and those investable assets, they should easily make it.* What it doesn't say, is what their debt is. How much is that home mortgage?* I can see going back to work because you just want to feel "necessary", but to do it for financial reasons is insane.* Plan, organize, and LBYM.. before you jump.

All it seems to be saying is that one retiree in nine went back to work for financial reasons (a third of a third).* Doesn't seem all that implausible.

[MRGALT2U]

Originally Posted by WhodaThunkit

All it seems to be saying is that one retiree in nine went back to work for financial reasons (a third of a third).* Doesn't seem all that implausible.

Does not seem "implausible" to me either. When I quit, I thought
going back to work was a "back up" option. Not now.
I suppose that there is some "work" that I could do. It would be
a "bitter pill" at this point.

JG

[kowski]

Always thought I was different than most.* This artical proves it.* I've been ER'd for 3 1/2 years now and do not want to even entertain the thought of going back to work.* Getting up when you want, visiting when you want, shopping when you want, traveling when you want, everything* "when you want" its simply the greatest.* *

[Martha]

Posted about a similar article a couple of weeks ago http://early-retirement.org/forums/i...p?topic=5098.0

That article mentioned an AARP survey that tried to focus in on why retirees return to work. The AARP survey found that the single most important factor was the need for money.

[astromeria]

The boomerang (back to work) retirees that I know are mostly fit and good-looking. Not sure how easy it is to get work in your 50s & 60s if you aren't--maybe via excellent connections, a former employer, or by starting a business.

The lack of subsidized health insurance for many early retirees is a huge issue. When my husband stops working, we'll probably get a catastrophic policy--else health insurance will consume 25-30% of our income at least. And that's without counting copays & deductibles! It already consumes 10% of our gross income despite his job (state college doesn't subsidize health insurance very much).

I'd have to be facing homelessness and starvation to consider going back to work
:P

[azanon]

The AARP survey found that the single most important factor was the need for money.

There's another reason to work?

[Sheryl]

Originally Posted by azanon

There's another reason to work?* *

SO's dad is in his mid-70's.* *He went back to work at a discount store (not Walmart but close) as a sort of bag-boy/gofer.* *I think the main reason was to avoid spending 24/7 with his wife, who talks non-stop about her health or lack of.

They love him there, and he enjoys the comradery with the "kids."* He refuses to work more than 5 hrs a day, more than 4 days a week, refuses to pick up trash in the parking lot - they like him so they go along...* Hearing his stories it's obvious he's enjoying himself and the extra $ probably don't hurt.*

[cute fuzzy bunny]

Bear in mind that the "study" here is run by an investment firm that has every reason to press people to stop being withdrawers and resume being depositors.

The company that did the study is brightwork partners, who is a quant shop that does customized studies and reports for mutual fund companies. Neither reveals the specifics about their survey or study, other than to say that they interviewed 1726 people who agreed/responded to a request to be "studied".

Unless i'm misreading their study results (only one cup of coffee...), they got their 7 million number by taking the 10% of people they surveyed that had gone back to work and "projecting" that against the bureau of labors numbers of 70 million people who work that are over the age of 40. 10% of 70 million is 7 million. Seems totally bogus to me.

In other words, interesting reading to create a dialog, zero credibility.

That having been said, I suspect a lot of retirees miss the work world (a la 'about schmidt') or discover that social security doesnt pay squat and they dont like cranking down on the budget.

In my dads 'sun city', he has hundreds of friends and thousands of acquantainces. I'm not aware of any of them that have gone back to work or are seriously considering it. But then again they're fairly well heeled people.

So to me this study says that investment companies want you to invest more before you retire so you dont have to go back to work, wishes people who retired would stop doing that and start working and investing again, and sends a good message that retiring without enough money is a bad idea.

[Ed_The_Gypsy]

Well, (), would you disagree that retiring without enough money is a bad idea?

Health insurance is also a very serious issue for most of us.

Sure, Putnam is an investment firm. Does that invalidate the above issues?

However, 1,726 out of 7 milliion does seem to be a statistically small sample and I wonder about the selection critieria. As posted, the article says that the group examined is the 7 million people already retired. You must have access to the original study, as you give more detail than the original posting.

Also, I have noticed that a lot of people retire in place and don't move. They are missing the opportunity to reduce cost of living by relocating to a cheaper locale. This alone could make the difference of having to go back to work or not. I think a lot of people stay put to be closer to the kids and friends and decide that going back to work is the price they must pay to do so. We are not so limited, but it is a personal decision.

Ed

[Martha]

Originally Posted by ()

Unless i'm misreading their study results (only one cup of coffee...), they got their 7 million number by taking the 10% of people they surveyed that had gone back to work and "projecting" that against the bureau of labors numbers of 70 million people who work that are over the age of 40. 10% of 70 million is 7 million. Seems totally bogus to me.

According to the Bureau of Labor Statistics 20% of men and 12% of women over 65 are now in the work force. That is quite a few people in the "normal" retirement years who are working. Wonder how many work part time and how many returned to work after trying retirement.

[SteveR]

Some people just need to work at something outside of the home. My great grandfather worked 6 days a week in his little used furniture store until the day the died at age 82.

My grandfather worked as a handyman and "jack of all trades" until the day he died at age 68.

My grandmother was a nurse and worked until she was 85.

My father retired at 65 but did volunteer work for 15 years.

My mother is the only exception. She retired from teaching at 62 and never worked at anything again; volunteer or not.

For DW and I, we don't intend on working again for $$ but we will do a lot of volunteer work. She is doing it now at her work and loves it so I see her continuing to do so long into retirement. I have the yard, the house and the cabin to keep me busy for years to come. So many projects....so little time. We also want to travel on our own terms so working would only get in the way of that. If we want to spend a month somewhere we want the ability to do that without being concerned about a job schedule. :P

[cute fuzzy bunny]

Originally Posted by Ed_The_Gypsy

Well, (), would you disagree that retiring without enough money is a bad idea?

Obviously, and I think I said so!

Sure, Putnam is an investment firm. Does that invalidate the above issues?

No, but the study certainly isnt particularly valid looking. Someone wanted to 'send a message' and paid someone to concoct something remotely factual looking to support the message. That certainly doesnt invalidate the thinking that one should plan financially for a safe retirement. It doesnt make me happy when someone hands me bogus data that creates an implication that a lot of people will be unhappy retired or run out of money and be pressed back to work. Whether thats the truth or not.

However, 1,726 out of 7 milliion does seem to be a statistically small sample and I wonder about the selection critieria. As posted, the article says that the group examined is the 7 million people already retired. You must have access to the original study, as you give more detail than the original posting.

Its worse than that. I read both the full report on putnams web site and the little bit that their partner wrote about. They didnt survey seven million. They cold called people that they thought were retired and out of the people they called (the known retired universe?), 1726 agreed to take their survey. From that they extrapolated seven million as ten percent of the 1726 went back to work after retiring. The extrapolation, as I mentioned, presumed the same 10% applied to the 70 million people working over the age of 40. I dont know where they came up with the "40" breakpoint, 65 or 62 would seem to more fully capture people who really were retired. But then there wouldnt be that huge number. I would consider 17000 people to be a pretty small sample for this sort of analysis. 1726 is noise.

Perhaps I misread their info, I did so early this AM and havent re-read it. But it screamed "we started with the points we wanted to end up with and reverse engineered the data to get to those points".

Also, I have noticed that a lot of people retire in place and don't move. They are missing the opportunity to reduce cost of living by relocating to a cheaper locale. This alone could make the difference of having to go back to work or not. I think a lot of people stay put to be closer to the kids and friends and decide that going back to work is the price they must pay to do so. We are not so limited, but it is a personal decision.

Along with staying in the same place, I think a lot of people might try to live the same lifestyle. That works great if you've planned for it. If you're like the average person who is in debt up to their eyeballs and hasnt put much away...not so much!

I just read a story in the paper about 2 local guys. One was 75 and the other 82. They both tried retiring in their late 50's, and were not very good at being responsible for their own entertainment. So they both went back to work. One of them started another business and actually went broke at age 75.

They claim that they are happy now. But for me, going broke at age 75 would have probably killed me.

[old woman]

Along with staying in the same place, I think a lot of people might try to live the same lifestyle. That works great if you've planned for it. If you're like the average person who is in debt up to their eyeballs and hasnt put much away...not so much!

My dad's sister in law is about 90 and has had the same job 25 years. When she turned 80 they made her a greeter instead of stocking shelves. Just before Christmas she started passing out, they had to put in a pacemaker. She is being forced to retire by her health, they are giving her a party next month. I don't know how she will live without the income, maybe her kids will support her. She never got around to saving for retirement.

[BUM]

Originally Posted by old woman

Along with staying in the same place, I think a lot of people might try to live the same lifestyle. That works great if you've planned for it. If you're like the average person who is in debt up to their eyeballs and hasnt put much away...not so much!

My dad's sister in law is about 90 and has had the same job 25 years. When she turned 80 they made her a greeter instead of stocking shelves. Just before Christmas she started passing out, they had to put in a pacemaker. She is being forced to retire by her health, they are giving her a party next month. I don't know how she will live without the income, maybe her kids will support her. She never got around to saving for retirement.

Sad story OW but at that age somethings gotta give. Can't have the greeter passing out on the greetee.

[markplus4]

I ER'd my burned out body in 2001 at 43.....and then had a lapse in judgement and decided to take a full time job in my field that came available locally in 2004. Bad mistake. Trust me, after tasting the good life and having your freedom, it's doubly difficult to go back to the full time grind. One particular week is burned indelibly in my memory.... 12 hour days, mountains of rework, meetings with pompous co workers & upper management....you all know the drill.

I suppose if Mr. Market bloodies my nose I could go back to part time employment, but even that would be tough.