Forget retirement. Here’s why you should work forever

Colin Lalley 1600


Colin Lalley

Colin Lalley

Insurance Expert

Colin Lalley is the Associate Director of SEO Content at Policygenius in New York City. His writing on insurance and personal finance has appeared on Betterment, Inc, Credit Sesame, and the Council for Disability Awareness.

Published July 4, 2017|4 min read

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From the time we start working, we have one goal: Stop working.

So we enroll in company 401(k)s and invest in IRAs and look into mutual funds and ETFs and every other (preferably tax-advantaged) account we can get our hands on to make sure we have enough money to retire. We even try to retire early.

And, as it turns out, we’re not that great at it. The median retirement savings for American working-age families is only $5,000.

That lack of savings inevitably leads to stress as we wonder how we’re going to pay for retirement – oh, and a mortgage and college and every other expense we have.

But what if we’re asking the wrong question? What if, instead of asking how we can retire, we ask why we should retire?

If we make the choice to never retire, it takes a lot of stress off our shoulders. It also benefits us in a number of other ways. Here’s why you should work forever.

Working is better for our finances

The problem with retirement is obvious: We keep spending money, but we’re not making it anymore. We have to keep living without an income. And that’s where we run into trouble. Over half of households in retirement won’t be able to cover essential living expenses, including housing, healthcare, and food, according to study from Fidelity Investments

As obvious as that problem is, the solution – continuing to work – is just as obvious. If we work, we keep making money.

It’s important to note, though, that this doesn’t have to mean working in a full-time capacity in our 70s and 80s. Side gigs or less strenuous jobs, where you’re working part-time, can help supplement any savings you do have. That IRA you diligently put money into goes a lot further if you only need to tap into it for half of your monthly savings.

You don’t have to work for all of your retirement, either; if you put off accessing your Social Security until you’re 70 years old, your annual allotment increases by 8% each year. If you can fill that gap with side work for a few years, it can mean a world of difference for your finances. (And, if you are in a rush to retire, you can find the pros and the cons of your current saving options here.)

Retirement doesn’t fit our lifestyles

It used to be a given that people would retire. You’d work somewhere for 40 years, collect your pension, and live out your golden years with a white picket fence.

Then pensions more or less went extinct, and retirement became a puzzle of fitting together 401(k)s, IRAs, and other investments to ensure that we had enough money to live on later in life. But the goal was still the same: Retire.

That’s no longer the case thanks to two fast-growing groups: Freelancers and millennials.

There were 55 million freelancers in 2016. Compared to salaried employees, freelancers are less likely to be saving for retirement. However, they’re more likely to be content with their jobs, too. Why stop working if you’re enjoying what you’re doing?

Millennials are also more likely to continue working after their "retirement" than previous generations. Almost half are going to keep working so they can continue to be involved in their passions, according to a Transamerica Center study.

All of this is to say that more and more people aren’t going to retire – at least not in the traditional sense – because they don’t want to, not because they can’t afford to. They’re making careers doing what they love, and they don’t want to stop after an arbitrary birthday. There’s two clear benefits to this strategy: You’re not overly stressed about retirement savings, and you’ll be doing more in your golden years than sit around watching daytime television.

Working longer is better for our health

If you don’t worry about retiring, it removes a lot of stress from your life. But continuing to work can also actively improve your health.

An Age Wave/Merrill Lynch study has shown that working during retirement contributes to improved mental stimulation, physical activity, and social connections — three things shown to contribute to longer lifespans. Working keeps our minds healthier, potentially staving off Alzheimer’s and dementia. Strenuous workouts contribute the most to our physical health, but any sort of physical activity can delay muscle and bone symptoms. And social connections have shown to increase our immune systems, self-esteem, and empathy.

Too many people atrophy during retirement, in more ways than one. Some people travel to stay active, but that can be prohibitively expensive. Others spend their time volunteering, which is an admirable alternative to working. But working has the added benefit of helping your financial health as well as your physical health, meaning there’s one less thing to worry about in retirement.

Maybe the biggest problem with retirement is that we see it as a binary option. We’re either working or we’re retired. The truth is, there’s an in-between. We can retire from the 40-hour-a-week, drive-to-the-office grind. But we don’t have to stop working completely. We can continue doing what we love, or find something new that we enjoy, that contributes to our financial well-being in important ways.

It makes the 20 or 30 years we spend in retirement that much easier, and by not stressing about retirement, it makes the first 40 or 50 years a lot easier, too.