Working through retirement may seem like an absurdly oxymoronic approach to one’s golden years, yet it’s becoming the norm.

Over two-thirds (69%) of unretired investors report they may work or continue working after retirement. In addition, nearly half say they have no choice – that they’ll need to do so to supplement their retirement income.

These findings from a recent survey conducted by Nationwide Financial suggest the traditional definition of retirement is changing as Americans live longer, look for sources of fulfillment, and to generate sufficient income to last a lifetime.

Uncertainty stemming from market volatility and rising inflation has forced many to revise their long-term outlook. According to the survey, many workers are considering post-retirement work and relocating to more affordable or tax-efficient parts of the country.

The trend signals the ever-present need for prudent planning so individuals can remain financially secure and personally fulfilled to make the most of post-career years.

Rethinking Retirement

Retirement in the 21st century just ain’t what it used to be. The simple days of having time to golf, travel, and enjoy hobbies are fading. Retirement has now become more multifaceted as retirees try to manage tight budgets and balance competing aims.

The rising cost of retirement is causing more retirees to return to the workforce. There are a host of drivers: from increased life expectancy and rising healthcare costs to the desire (or need) for additional income as well as the sense of meaning derived from work.

Many retirees want to aim for something bigger than the little flag on the golf green – they want to undertake something fulfilling in retirement that keeps them mentally and socially engaged.

The tendency of older workers to stay in the workforce is a long-term trend that has been gaining pace since at least the turn of the century. From 2000 through 2015, the labor force participation rate for American men aged 65-69 rose from 30% to 37%, while for women, it rose from 19% to 28%.

“Advisors have to adjust to more retirees working part-time,” says Jonathan Bird, a financial advisor at Farnam Financial. “There is a significant difference in the quality of life and longevity between retirees who stay active and those who don’t. If starting a side business while in retirement makes you excited to get out of bed, then get after it!”

What About Social Security?

It’s essential to factor in Social Security benefits when weighing up whether to work during retirement. Most retirees expect social security to fund 70%-80% of their pre-retirement earnings.

This means they would need extra income to help supplement their lifestyle. Retirees need to expect Social Security to cover at least 40% of their expenses in retirement. However, with possible budget cuts to Social Security in the future, it could be more like 30%.

Suppose someone retires and is still at full retirement age for social security. In that case, “their social security benefits could be negatively impacted by the amount of money they earn during retirement,” says Jon McCardle, AIF, President, Summit Financial Group of Indiana.

A solid financial plan for social security and retirement funds is necessary at this age. You never know how much costs could go up and how much you may need.

Ignorant Bliss?

One may think those who’ve prepared for retirement with a will be less worried, but curiously, that’s not the case.

According to the Nationwide Financial survey, 49% of non-retired investors who work with a financial advisor are “very nervous” about spending their retirement savings in the current market environment, compared to 32% of investors who do not work with one. This uncertainty may stem in part from the current economic climate.

“Research suggests taking distributions from accounts during down or bear markets can significantly impact the principal and the retirees’ ability to avoid outliving their money,” says McCardle. He suggests delaying retirement a year or two to avoid damaging investments could be better.

With market volatility, retirees could be nervous about the future. That brings on extra anxiety that brings them back to the workforce or delays retirement.

Taking on a part-time job in retirement can bring mental stimulation and a sense of purpose. However, if it’s not handled properly, it can lead to burnout and decreased health. In weighing up what’s the right approach, it is important to keep in mind what is driving people to keep working.

Some workaholics may be unable to quit the habit of making (and saving) money, while others who are short on cash will just have to work to survive while their bodies are getting feeble.

Ultimately, continuing to work should be a choice. Being financially secure before retirement gives people the freedom to work or not work as they see fit, ensuring a happy and fulfilling retirement experience.

This post was produced by Wealthtender and syndicated by Wealth of Geeks.

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Liam Gibson | Wealth of Geeks