Here’s how to recover from a boring retirement you can’t afford.
After waiting years for their retirement, some people still make one of the biggest retirement mistakes of all: They retire before they are mentally or financially prepared.
Some retirees just get bored. Other seniors miss interactions with colleagues and clients. You might also realize after a while that you haven’t saved enough money and need to return to work to bring in more income.
“I have found that many people step out of the workforce maybe a year or two too early so they can do things they always wanted to. They want travel and to do hobbies that they haven’t had time to do,” says Kerry Hannon, an author and career expert based in the District of Columbia. “Around the two-year mark they get a little itchy. A lot of folks find when they are settled that they are bored.”
If your retirement has lost its luster, here’s how to recover:
Find something to do. New retirees often have a bucket list of travel goals, opportunities to bond with grandchildren and potential new hobbies. “Two years in, they run through their to-do list and are bored and don’t have the social network they once had,” Hannon says. “They then stumble over the question of what to do.”
Retirement can be especially difficult for people who retired involuntarily early due to a layoff, to get away from a stressful or frustrating job or to claim workplace benefits before they are discontinued. “I’m not sure that should be your primary reason [to retire],” says Skip Johnson, a financial advisor and founding partner at Great Waters Financial in Minneapolis. “A person should start with an end in mind.”
Take on a volunteer position. Volunteer work can be an antidote to boredom. “We usually talk to them about trying to find something to do, whether it’s volunteer work or something else,” says Nick Abrams, a certified financial planner with AJW Financial Partners in Columbia, Maryland. “If they want to do something part-time that is stress-free, just find some kind of activities, whether [it’s] going down to the local senior center or volunteering at an elementary school reading to kids.”
Sometimes, retirees miss their friends and colleagues from work. Many people also tie up their identity in what they do for a living. The solution is the same. “If you are no longer working and part of your identity is missing, we encourage people to volunteer,” Johnson says. “Find a board position. Mentor young business people. Give back to your community. Get more involved in church. Go where you can fill your time with something valuable.”
Go back to school. Many retirees return to the classroom to learn about topics they are interested in. “Often it’s not about money,” Hannon says. “We’ll often encourage active hobbies, passions and encourage people to go back to school and pick a topic they enjoy.” Some colleges offer tuition discounts to seniors, while others provide classes specifically for retirees.
Taking classes or obtaining a degree can also be a way to learn new skills and transition into another job. “If you take two years out of the workforce, you will need to brush up,” Hannon says. “What do you need to ramp up your skills, and how do you do it affordably?” It’s not impossible to get back into the workplace, but it will take some preparation.
Return to work. Some retirees burn through their retirement savings quicker than they want or have anxiety about large medical bills. “If you retired too young and draw heavily on your assets, that can be a problem,” Johnson says. “We do often encourage them, if they can, to work a little. Can they work part-time in their old position? Can they do consulting? Can they find a job?”
Even a part-time job allows you to defer using your retirement savings or take smaller withdrawals. “Just being able to work for pay as a safety net is quite desirable and gives them peace of mind,” Hannon says.
A part-time job combined with some budget cuts can usually get your retirement finances back on track. “They may need to change their lifestyle a little,” Johnson says. “They could go back to work, and they can make sure their investments are aligned properly for risk tolerance.”
If you’ve already started Social Security payments, you still have the option to go back to work. “People who turned on Social Security think they can’t go back to work or they will lose Social Security,” Johnson says. “If you have taken Social Security within the last 12 months, you can undo it. You can stop the benefit and pay [the benefits you have received] back. That might be a good option.”
Another option, if you are 66 or older, is to temporarily suspend your Social Security payments. This strategy may even increase your monthly benefit when you resume payments. “They will continue to get deferred income credits,” Johnson says. “It grows by 8 percent a year.”
However, it’s not always easy for older workers to find a new job. You might need to apply your existing skills in a new way or acquire additional qualifications. Reach out to your network of friends and colleagues. “Tell people you’re looking for work,” Hannon says. “Get the word out, and don’t be afraid to ask people you know about opportunities.”