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Top five reasons to consider an encore career

Nov 9, 2021
Empower Insights

Not everyone wants a quiet retirement. And although working in retirement can mean a lot of different things, “encore careers,” or second vocations that provide a sense of purpose or fulfillment, can be appealing to some retirees.

Here are five reasons to give it some thought.

You can work for a social cause.

An encore career can be about more than financial stability. It can provide an opportunity to take a step back and pursue work that you love.

This could be anything, but many find their encore careers in one of five areas: healthcare, the environment, education, government or nonprofit work.So if a social cause is important to you, retirement might provide the perfect opportunity to dedicate yourself to it.

Encore careers supplement your retirement income.

One of the most fundamental things to consider when you’re planning for retirement is the fact you’ll likely live a long time after you retire. One recent study found that American men who reach age 65 can expect to live 18 years longer on average, and 65-year-old American women live over 20 more years on average.2

Congratulations! But a long life may also mean needing to survive on your retirement savings for 20 years or more, and that can be a tall task.

To that end, an encore career might keep you from drawing from your existing savings, allowing those funds to continue growing. And an encore career with health benefits can be beneficial as healthcare is frequently one of the most significant sources of expenses in retirement.3

A woman with gray hair works at a call center

An encore career can be flexible and give your life variety.

A part-time job in retirement, with fewer, more flexible hours can give you the positive experiences of working without the burnout and stress you may have experienced working full-time.

Also keep in mind that many retirees complain of boredom,4 and a part-time job can provide a break from all that free time, enriching the time you spend working and the time you spend relaxing.

Working improves your physical and cognitive health.

Research suggests that working later in life helps keep a person sharp both physically and mentally. We all know how difficult it can be to maintain an exercise routine, and there’s often no substitute for the day-to-day mental challenges provided by a job.

A 2016 study in the Journal of Epidemiology and Community Health5 found that working just one extra year was correlated with a roughly 10% lower risk of dying during the 18-year study period. Studies have also found that people who retire later in life frequently outscore earlier retirees of the same age on memory tests.

Just make sure to avoid undue stress and anxiety in your encore career as those will negate any positive effects of working later.

Jobs provide emotional support and community.

One of the more startling facts about retirement is that many retirees experience mental and emotional difficulties like depression and anxiety.6 A primary cause of this is the isolation and loneliness that can result from not seeing your colleagues and having fewer reasons to leave your home.

To this end, the Stanford Center on Longevity asserts that a “social portfolio” is just as important for your long-term health as a financial portfolio.7 For many retirees, an encore career might be the perfect avenue to the continued community, support and friendship experts recommend should be part of one’s social portfolio. It’s impossible to overstate how important it is to avoid depression and anxiety in retirement — after all, what’s the point of being retired if you’re not enjoying it?

Encore careers aren’t for everyone, and if you do just want to sit back and play golf when you retire, that’s okay, too! But if you find yourself itching to get back in the workforce, know you’re not alone as 61% of near-retirees are on the same page8 — and also know that an encore career can be a meaningful part of your second act.

1 Investopedia.com, Julia Kagan, “Encore Career,” November 2019

2 Statistica.com, John Elflein, “Life expectancy – Men at the age of 65 years in the U.S. 1960-2017,” November 2019

3 Investopedia.com, Rebecca Lake, “How to Plan for Medical Expenses in Retirement,” November 2019

4  TD Ameritrade, “Unretirement Survey,” November 2019

5 Journal of Epidemiology & Community Health, Chenkai Wu, Michelle; Odden, C.; Fisher, Gwenith G.; Stawski, Robert S., “Association of retirement age with mortality; a population-based longitudinal study among older adults in the USA,” August 2016

6 Psychiatry Research, Segel-Karpas, Dikla; Ayalon, Liat ; Lachman, Margie E., “Retirement and depressive symptoms: A 10-year cross-lagged analysis,” 2018

7 Stanford Center on Longevity, Yotopoulos, Amy; Streeter, Jonathan, “Social Portfolios are just as important as financial portfolios,” 2016

8 Empower Institute, “Rethink, Rewire, Retire,” October 2020.

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