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Most Americans Plan to Work in Retirement. Here's Why You Should, Too.

By Maurie Backman - Nov 19, 2019 at 6:36AM

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Holding down a job during your golden years has its benefits.

Many people regard retirement as a period not to work. But actually, working during your golden years offers a number of benefits, so much so that the majority of Americans aged 40 to 79 think they'll earn an income in some capacity once their main careers come to a close.

In a recent TD Ameritrade survey, 92% of adults in their 40s say they plan to continue doing some type of paid work in retirement. The same holds true for 86% of adults in their 50s, 66% of sixtysomethings, and 52% of those in their 70s. If the idea of working during retirement seems foreign or unappealing to you, here are a few good reasons to jump on the bandwagon and plan to do some type of income-generating activity during your golden years.

Smiling older man wearing yellow hard hat in warehouse


1. You can make up for a lack of savings

It's estimated that nearly half of Americans aged 55 and over have no money socked away in a dedicated retirement savings plan, like an IRA or 401(k). If that's the situation you're in, you should know that Social Security alone won't cut it. Those benefits pay the average senior today $17,748 a year, and chances are, that's not enough income to maintain the lifestyle you're accustomed to. Working during retirement is therefore a great way to compensate for a glaring lack of savings, all the while sparing yourself a host of sacrifices you might otherwise have to make when you're older.

2. You may need more money for a longer lifespan

Americans are living longer these days, which means that even if you've saved nicely for your golden years, you may need extra money on hand in case you end up thriving well into your 90s, or even beyond. In fact, the Social Security Administration estimates that one out of every seven 65-year-olds today will live past age 95. If you've saved enough to carry yourself only into your late 80s, working during retirement is a good way to leave some of your existing savings alone so that money is there for you when you're much older, and possibly not in a position to hold down a job.

3. You'll need something meaningful to do with your time

Retirees are 40% more likely than workers to suffer from clinical depression, reports the Institute of Economic Affairs, and a big part of the reason comes down to boredom. Many people assume their golden years will be jam-packed with travel, activities, and nights out on the town. But here's a reality check: You need a lot of savings to maintain that sort of lifestyle in the absence of an income, and if you don't have a whopping sum socked away, you may find that you can't afford to keep yourself busy the way you'd like to.

Working during retirement is therefore a good solution in two regards. First, it'll give you more income to buy yourself entertainment. Secondly, it'll give you something interesting to do with your time so you're not overwhelmingly restless. In fact, in the aforementioned survey, almost 40% of adults in their 40s and 50s say they plan to continue working in retirement even if there's no financial need to do so, which speaks to the value of holding down a job.

Remember, working in retirement doesn't have to mean sitting in an office, manning a checkout counter, or doing something that makes you unhappy. There's always the option to start your own business, or find a flexible gig you can do at your own pace and in your own space. And these options might really give you the best of both worlds.

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