63% of Workers Bet on This Retirement Strategy. It Rarely Works.

Advertising Disclosure: When you buy something by clicking links on our site, we may earn a small commission, but it never affects the products or services we recommend.

Unhappy woman in retirement
fizkes / Shutterstock.com

If you are not comfortable with the size of your nest egg, planning to work a little in retirement probably sounds like a good strategy.

By taking on a part-time gig, you can retire from your full-time job while generating some extra income to stretch your savings.

Many Americans plan to pursue this strategy. In a recent Allianz Life survey of 1,000 adults aged 25 and older, 63% said they will likely work at least part time in retirement to supplement their income.

Unfortunately, according to a different recent survey, it rarely works out that way.

A separate survey of current retirees by the Employee Benefit Research Institute (EBRI) found that 70% of them left the workforce before the traditional retirement age of 65 — with their median retirement age being just 62. We reported the results of that survey in “Today’s Seniors Reveal 6 Surprising Lessons About Retirement.”

In addition, while the Allianz Life survey found that 47% of workers say they expect retirement to unfold as a gradual transition away from full-time work, that isn’t what retirees reported to the EBRI.

A full 74% of retirees in the EBRI survey said they experienced a “full-time stop” in which they quit working all at once.

The surveys show a sobering disconnect between what workers imagine they will do in retirement and what actually happens once they get there. The survey results also remind us that we don’t always control our destiny. As we reported in our recap of the ERBI survey:

“Stopping work earlier in life isn’t always a choice. Half of retirees overall retire sooner than they expect, and almost 70% say they made the choice for reasons that were beyond their control.”

Perhaps the biggest takeaway from the survey results is that retiring first and hoping to figure things out later is a poor substitute for developing a sound retirement strategy much earlier in life.

Laying the groundwork for retirement years or even decades before your career ends can put you in a much stronger position to enjoy your golden years. As anyone who has actually retired knows, life often unfolds in ways we don’t expect — and don’t always prefer.

Planning well and creating an extra financial cushion can help you get by and even thrive when retirement throws you some unexpected curves.

Get smarter with your money!

Want the best money-news and tips to help you make more and spend less? Then sign up for the free Money Talks Newsletter to receive daily updates of personal finance news and advice, delivered straight to your inbox. Sign up for our free newsletter today.