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Jewish World Review Nov. 13, 2007 3 Kislev 5768 Gradual retirement may not be key to happiness By Gail Marks Jarvis
http://www.JewishWorldReview.com | (MCT) Ask a baby boomer what his or her retirement plan is, and you are likely to hear: "Work forever." It's a standing joke in a generation that includes many who lived a little too much for today and not enough for tomorrow. With more than 70 million baby boomers moving closer to retirement age, about 80 percent say they plan to work at least part-time after retiring, according to AARP, which has surveyed boomers extensively. Money is the top reason, but so is enjoyment. While keeping a foot in the work world should help pay for groceries and trips to see grandchildren, it might not make the next generation of retirees any happier than those who simply call it quits on retirement day. Retirees who left work cold turkey are as happy as those who held onto jobs and retired gradually, according to a just-completed study by the Boston College Center for Retirement Research. Rather than remaining at work, the key factor for a happy retirement seems to be control, according to the study led by Steven Sass, associate director for research at the center. Retirees who left work when they were ready to retire were happier than those forced from jobs they didn't want to leave, the researchers said. In addition, retirees who suffered from health problems that created daily hassles were less happy. And after the loss of a spouse, retirees experienced "significantly diminished happiness," the report said. Jack Wolfe, a pharmacist from the Chicago area, is among retirees who long for work and the opportunity to do it. He tried gradual retirement at age 72, after selling the pharmacy he owned for 35 years. He worked part-time at a Costco pharmacy but had to give it up because he couldn't stand eight hours a day with a back problem. He misses the customers so much he is inclined to offer help to people he sees laboring over a choice of over-the-counter drugs in a store. And at 79, he is planning to attend some pharmacist seminars to keep up on the latest thinking in his profession. His advice to people considering retirement: "If you like what you are doing, stay with it as long as you can." As policymakers look at the effects that baby boomer retirements will have on companies and government, it has been assumed by some that phased retirements might help. Robert Hutchens, a professor of labor economics at Cornell University, noted in a paper in February that surveys such as AARP's show people eager to work in retirement. And gradual retirement could provide businesses with experienced workers and take pressure off corporate pensions and Social Security. Whether working longer will make retirees happier, however, is not a certainty. The Boston College researchers studied 2,389 individuals who were fully employed and then retired gradually, or all at once. They used data from the federal health and retirement study that tracked older Americans for many years. They looked at whether people were happy, enjoyed life, were sad, lonely or depressed. They analyzed whether people who were happy when working full-time remained that way, or changed, when retiring gradually or all at once. While gradual transitions give workers time to shift their daily activities, relationships and identity in a deliberate manner, the researchers said the gradual approach was not much different than jumping into a swimming pool: "People know it generally makes no difference whether they dive straight into a swimming pool or gradually acclimate their body to the water. But, for whatever reason, most opt for the latter approach." According to AARP research, 35 percent of baby boomers say they plan to work simply for the enjoyment of it. If the Boston College research is correct, the happiness of those boomers may depend upon holding onto their health and the jobs they want. Yet both are more uncertain than boomers may realize. Hutchens noted that employers can be reluctant to offer part-time, or phased retirements, because the arrangement can be at odds with pension and health-care policies. Also, while 73 percent of employers said in a survey that they would be willing to offer jobs to retirees, they typically envisioned it for certain part-time responsibilities - perhaps not the jobs retirees would want. Also, employees could find that they will lose some of their pension benefits by staying to do part-time work, Hutchens noted. Often, pensions are computed based on the pay people have earned late in their working years. If they move to a part-time job, the pay - and consequently the pension - would be smaller. The realities may take boomers by surprise. They might feel a loss of control when their employers don't deliver the jobs they envision, on the terms they want. Their health could turn out to be an unhappy surprise. According to the AARP research, only 16 percent of baby boomers believe they could have a serious health problem when they retire. But according to a Fidelity Research Institute report, nearly a quarter of all retirees left work early because of health reasons. Every weekday JewishWorldReview.com publishes what many in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here. Gail Marks Jarvis is a personal finance columnist for the Chicago Tribune and author of "Saving for Retirement without Living Like a Pauper or Winning the Lottery." Comment by clicking here.
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