Three Reasons Some People Choose to Never Retire (2024)

Why Throwing Traditional Retirement Out the Window May Not Be a Bad Idea

Many of us spend our entire careers dreaming of the day we’ll finally be able to retire, but some people actually choose to never retire – at least not in the traditional sense. It may sound crazy if you’ve never stopped to consider it, but you might just find it’s not an altogether unfathomable scenario to eschew traditional retirement in favor of an alternative option.

According to the Economic Policy Institute, the median retirement savings of all working-age families in the U.S. is $5,000. That lack of a safety net or savings to lean on means that the idea of retirement is incredibly stressful for many families who are still paying mortgages and having to think about things like college or wedding costs for children.

With that number in mind, here are three of the main reasons some people choose to opt against retirement in the traditional sense:

Working benefits your finances.

The most obvious problem with retirement is that you must keep spending money even though you’re no longer earning it. You still have to cover living expenses, such as housing, healthcare, and food costs, which for over half of households in retirement, is impossible. If you find yourself in this boat, your best option is likely to continue working.

It’s important to note that you don’t have to continue working in a full-time capacity into your 70s and 80s, however. Finding part-time or less strenuous work is certainly an option. You can also turn a hobby, like painting or knitting, into a small business as a way to generate income to supplement any savings you may have. Additionally, any contributions you’ve been making to your IRA or other tax-advantaged accounts will go much further if you can avoid dipping into it for all or a portion of your monthly expenses.

If working during your retirement years feels off-putting, remember that it doesn’t mean you have to work forever. If you’re able to put off accessing your Social Security until you’re at least 70 years old, your annual benefit will increase by 8% each year – that could mean a world of difference for your finances.

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Retirement may not fit your lifestyle.

Historically, the arc of the American work experience went something like this: you’d work somewhere for 40 years, collect your pension, and live out your golden years enjoying retirement. Now that pensions are more or less extinct, retirement has become a puzzle of sorts where we scramble to fit together our 401(k)s, IRAs, HSAs, and other investments to ensure that we’ll have enough money to live on as we age. However, pensions aren’t the only thing that has changed when it comes to our careers. Freelancers and Millennials have also transformed the way that we work and, consequently, think about retirement.

As of 2019, 35% of U.S. workers are now freelancing – that’s 57 million people. Compared to salaried employees, freelancers are less likely to be saving for retirement, though they’re more likely to be content with their jobs. And those who are enjoying their careers are less likely to be as eager for retirement as those who aren’t as satisfied with their job.

According to a Transamerica Center study, almost half of Millennials – today’s youngest generation in the workforce – plan to continue working in some capacity after their “retirement” in order to stay involved in their passions and community.

What we can learn from these two groups of people is that there is a way to reimagine retirement where we can continue working in ways that affirm our passions, feed our souls, and provide us with the supplemental income many of us need. There are two clear benefits to this strategy: you’re not overly stressed about retirement savings, and you’ll have productive and healthy ways to fill your free time in your retirement years.

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Working longer benefits your health.

For some, it’s the financial and lifestyle benefits that lead them to choose to never retire in the traditional sense. For others, it’s the proven health and wellness benefits.

A study by Age Wave/Merrill Lynch found that working during retirement significantly contributes to improved mental stimulation, physical activity, and social connections – three main things proven to contribute to longer lifespans. This is because working keeps our minds engaged and, therefore, healthier overall, potentially helping you stave off diseases such as Alzheimer’s. While strenuous workouts contribute the most to our physical health, any kind of physical activity can help delay the onset of age-related muscle and bone concerns. Socially, maintaining regular connections has been shown to increase our immune systems, our self-esteem, and our empathy.

So, is traditional retirement right for you?

When it comes to thinking about retirement, perhaps our biggest fault is that we see it within a binary framework of either working or retired. The truth is that there is an in-between that’s bubbling with opportunities and options. There is a way to leave your 40-hour-a-week office grind without completely exiting the workforce and even options that could inspire your passions and interests. It’s possible to continue doing something you love or find something new to enjoy, that contributes to your financial well-being in important ways, too.

At the end of the day, you’re the only one who can decide what is best for you and your unique situation. Remember that a breadth of options exist if you allow yourself to think beyond the traditional retire-work binary. Your retirement years are yours, and you can make of them whatever you’d like.

If you’re interested in professional guidance in determining your retirement plans, please schedule a discovery call with us today. At Andersen, we understand the importance of feeling like you have control over your financial future, and we offer our experience and knowledge to design a specific plan of action unique to each of our clients’ needs.