After working hard your entire life, retirement can be an extremely welcome milestone. But what if your senior years don't play out the way you expect them to? Should you power forward and hope things take a turn for the better? Or return to the workforce even though you thought your initial exit would be a permanent one?
In some cases, un-retiring can make your senior years far less stressful and much more fulfilling. Here are three signs that that's your best move.
1. You're plowing through your savings too quickly
Depleting your retirement savings prematurely could result in years of financial struggles when you're older and more vulnerable. If you've been drawing down your nest egg at a more aggressive rate than expected because you need the money to cover your expenses, then returning to the workforce for a few more years could help you alter an otherwise problematic trend.
How much should you be withdrawing from your savings on a yearly basis? There's no single right answer to that question, but many financial experts advocate the 4% rule, which states that if you begin by removing 4% of your nest egg's value during your first year of retirement and then adjust subsequent withdrawals for inflation, your savings should last 30 years.
Now you may not need your savings to last that long, especially if you retired on the later side. But if you find that you're withdrawing more like 8% or 9% of your savings per year to keep up with your bills, then it could certainly pay to go back to work, boost that nest egg, and then retire again once you're in a stronger place financially.
2. You're overwhelmingly bored
Retirees are 40% more likely to suffer from depression than workers, and the reason often boils down to being bored. If you find that you're not enjoying your lifestyle in retirement as much as you expected to and you're largely starved for entertainment, then you should know that the longer that routine continues, the greater your chances of experiencing mental health issues.
A better bet may be to return to the workforce to give yourself something to do with your days, especially if you're more than physically capable of holding down a job.
3. Your health is declining
Many seniors find that as they age, their health starts to deteriorate. But if your health is declining because you're mostly sedentary and have few excuses to get out of the house, then returning to work could be just the thing to stop that dangerous progression. Between commuting and staying busy in an office, you may find that once you go back to work, you're suddenly getting exercise, losing weight, and generally feeling better. In fact, some studies show that working longer can actually lead to a longer life.
Many seniors retire at the wrong time and regret it after the fact. If you're having financial issues in retirement, aren't enjoying it as much as you expected to, or are risking your health due to not having anywhere to be on a daily basis, then resuming your career could be the best choice for you.
If you do decide to un-retire and you've been on Social Security for less than a year, you also have the option to undo your benefits and claim them again at a later point in time. Doing so could allow you to lock in a higher monthly benefit, which may, in turn, help you not only avoid money-related struggles, but buy you the freedom to do more with your newfound free time.