While a lot of Millennials plan to retire by 40, some of the Baby Boomers weigh the pros and cons of working even after retirement. There are multiple reasons why you should keep working even after retirement.
Over the last decade, the U.S. job market has faced a peculiar problem. A lot of Baby Boomers are now retiring, which has put pressure on the labor market. The trend is expected to continue over the next few years as more Baby Boomers reach retirement age.
Continuing to work after retirement is a good idea.
Continuing to work after retirement age is a good idea for the following reasons.
- Avoid boredom
- Increase your retirement nest egg
- Learn new skills
- Contribute meaningfully to the society and the economy
- Avoid health problems by staying active
Retirement can be boring.
Unless you have planned your retirement with say a world tour, social service, or spending time with family including grandchildren, retirement can be boring. If you keep working after retirement, you can avoid boredom.
Also, you can improve your finances and increase your retirement nest egg. This would be especially true if your retirement savings aren't sizeable. If you keep working after retirement, you can increase your retirement savings. The extra savings will help you not only lead a better lifestyle but also perhaps finance a dream holiday.
Looking at the current inflationary environment, it might be better to keep working after retirement. The COVID-19 pandemic and now the multi-decade high inflation is yet another reminder that you might need more money after retirement.
Working after retirement could give you a sense of fulfillment.
Working after retirement can also give you a sense of fulfillment. You would be able to contribute to society as well as the economy. Under the current scenario, where there's a labor shortage in the U.S., you can help alleviate the problem. Also, you can use your experience to help guide new or younger workers.
You can learn new skills.
You might even learn a new skill that you always wanted during your working age. While working in a new field might not give you high monetary benefits, it could help you enhance your skills.
You may also be able to choose flexible work hours if you decide to work after retirement. Assuming money isn't the sole reason you're choosing to work after retirement, you might even work for fewer hours than you did during the normal working age.
There are health benefits to working after retirement.
There could be health benefits to continuing to work after retirement. According to WebMD, seniors who do part-time work after their retirement have fewer serious diseases like diabetes, high blood pressure, lung and heart disease, and cancer. Also, they're less likely to have psychiatric problems.
There are cons of working after the retirement.
That said, you might also want to consult your financial adviser on the cons of working after retirement. For example, it might impact your social security benefits, Medicare eligibility, and taxes. Finally, if you choose to work after retirement, you will have less free time.