1 in 5 Seniors Work in Retirement. But Is It Right for You?

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Retirement means never working again, right? Maybe not. Find out why having a job in your golden years is good for your life and your finances. [[{“value”:”

What does retirement mean to you? For a lot of people, it means turning in their daily commute, brown-bag lunch, and briefcase to enjoy never working again. But for others, it might mean working less but still seeing a paycheck deposited into their top-rated checking account.

According to Pew Research, 1 in 5 Americans aged 65 and up were still working in 2023 — and their earning power has grown more than that of younger workers, to boot. Let’s take a closer look at why having a job in your golden years can be a net positive for your life.

Pad your emergency fund

The reason any of us work is to earn money, and your need for that sure won’t go away once you’re done with the daily grind. Working in some form or fashion in your golden years gives you the chance to ensure your emergency fund is flush with cash for unplanned expenses.

You may be drawing from a retirement account to cover your planned expenses, but it’s still a smart idea to have at least six months’ worth of bills in an accessible savings account. You never know when you’ll need to tackle a home or car repair, and you’ll sleep a lot better at night knowing that money is ready. With a part-time job, you can also replenish your emergency fund as you dip into it.

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Keep investing

Along with adding more cash to your savings account, earning money via a retirement job also gives you the chance to continue investing. While it’s true you won’t have the same long timeline you had when you were investing in your 20s, 30s, or 40s, just being able to buy stocks and stay invested for a decade could benefit your finances.

The S&P 500 has earned an average annual return of about 10% over the last 50 years. But let’s be more conservative and say you manage to contribute $200 to a brokerage account per month over 15 years and earn an 8% return.

Your contributions ($36,000) could end up growing to be worth more than $65,000 over 15 years. And at a time in your life when you’re likely to have more medical expenses, that money is likely to come in handy.

Explore a new line of work

Maybe you hated the career you were in during your prime working years. For you, the prospect of going back to that type of work is likely unappealing.

But if you’ve been able to save and invest in a retirement account like an IRA during your career, and you just need a part-time income to get by now, you have a great opportunity to explore something new. I’ve known many seniors who were doing just that in retirement, and I met a lot of them in my own former career as a museum professional.

I knew teachers (and even farmers!) who retired and came to work part-time as museum docents. Others had office jobs but came aboard to be front-desk associates and gift shop clerks.

One of my favorite museum helpers had retired from a career as a nuclear technician, went to school to get a masters degree in library science, and helped me with curatorial projects, exhibits, and even grant-funded work. All of these people loved their retirement jobs and were excited to educate the public and help preserve history.

Enjoy the emotional and mental benefits

At its best, working does more than pad your bank account — it gives you the ability to socialize with others. According to the NIH’s National Institute on Aging, seniors can be particularly vulnerable to loneliness and social isolation, which comes with physical health impacts. Working as a retiree could mean avoiding depression, cognitive decline, and even heart disease.

You might’ve seen the end of your prime working years as a time of celebration. But continuing to work offers a lot of benefits that are worth considering. Even a casual side hustle like walking dogs or driving for a ride-hailing service gets you out of the house and gives you something to occupy your time. It’s certainly worth considering to see if it’s right for you.

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