Yahoo Finance's Could Semi-Retirement Be Right For Me defines semi-retirement as:
"a transition stage to full retirement during which people usually work fewer hours, either at their former employers or in a new part-time job. Semi-retirement can generate additional income while also providing engagement, satisfaction and even better mental and physical health."
Generating income is a key reason many are semi-retired.
But as The Atlantic's Semi-Retirees Know the Key to Work-Life Balance points out, most semi-retirees seek more than income from their semi-retirement work.
And they especially value work flexibility. Key quote:
"...semi-retirees tend to look for roles that grant a sense of purpose, the ability to keep learning, and, perhaps more than anything, flexibility."
Historically, flexible work the semi-retired look for was hard to find. The vast majority of full-time and even part-time jobs required a commitment to fixed schedules.
But thanks to the growth of the gig economy, various forms of self-employment, and more flexible traditional jobs, semi-retirement is much easier than in the past.
But it still requires research and planning.
Fidelity's Guide to Working Less and Living More suggests 4 key things to consider before jumping into semi-retirement:
- Think through your long-term financial needs before embarking on semi-retirement.
- To make it work, know exactly how much money you spend and where you can cut back if necessary.
- Understand the costs of health care once you leave an employer's plan.
- Do some self-reflection to determine what you want to get out of semi-retirement.
Fidelity also suggests starting thinking and planning about semi-retirement well before you plan to semi-retire. Key quote:
"It's best to begin planning—and saving—during your wealth accumulation years to capitalize on employer benefits and the power of compounding."
We regularly interview people who fit the description (but rarely self-describe) as semi-retired. And based on what we've heard, Fidelity's planning advice rings true.
A key reason we study semi-retirement is that older workers have the highest levels of self-employment.
And more baby boomers looking to semi-retire instead of fully retiring means more independent workers.
