Semi Retirement and Career Change

picture of older couple working with financial advisorToday, many Americans are reexamining the blurring lines between employment and retirement like never before.

From retirement planning tools like retirement calculators and savings goal trackers to setting up retirement savings accounts, making sense of semi or early retirement requires careful planning these days.

Career Change and Growth

Largely gone are the days of entering a career at 21 and continuing in the same profession for the next three decades without major change. The idea of career-long loyalty, either employers to employees or the reverse, has certainly changed over the past decade. Today, it is not uncommon to experience several major career shifts and job changes during your working years. Semi retirement is about embracing that change.

It's also about personal development and growth. Whereas in the past, changing jobs was sometimes perceived as fickleness or an inability to stay put and focus, today more employers are aware that prospective employees develop a larger skill set and a wider network of support when they are adaptable enough to change jobs, even specialized careers, multiple times.

How to Plan for Retirement — Semi or Otherwise

Whether you call it semi retirement or part-time work, before you begin a phased reduction in the hours you work, you'll want to take a long, hard look at your financial needs. The variables are enormous, depending on your age, salary, what you've saved to this point, as well as your current lifestyle. Examine your work options: Your own company might hire former or retiring employees as independent contractors.

According to The Wall Street Journal, "The median household headed by a person aged 60 to 62 with a 401(k) account has less than one-quarter of what is needed in that account to maintain its standard of living in retirement." For 60 percent of retirees 65 and older, the bulk of their retirement income comes from Social Security — and the average payment is about $1,150 per month — a frightening proposition considering many of our lifestyles.

The truth is, it's never too early to start saving. And it's never too late. Aim to save at least 10 percent of your income for retirement. Auto debits from checking to retirement savings accounts in online banking are a simple way to move more money into your savings, effortlessly. Pay off your credit cards. Maximize the tax savings of employer-matching 401(k)s. Regions has retirement calculators you can use to learn more about your own financial situation.

What is Retirement, Anyway?

A number of social scientists, writers, teachers and of course, bloggers, have begun reexamining this question. Just what does the word "work" and "retirement" really mean? An essay by Leilani Clark, "Why Work? The case for working less and living more," explores this question in depth and cites several other sources for further reading such as Professor Juliet Schor's Plenitude: The New Economics of Truth Wealth or Annie Leonard's  The Story of Stuff project.

In Walden, Henry David Thoreau famously declared, "I wanted to live deep and suck out all the marrow of life." Retirement, in the best sense, offers the chance to do just this, whether that means the joy of traveling, the satisfaction of volunteering for a worthy cause or perhaps just reading all the good books you never found the time to get to during your busy career.

In the case of semi retirement, it can mean all those invigorating, exciting prospects as well as maintaining a source of income — something the best retirement calculators contend with. Semi retirement is about working less and living more.

The following Web sites and other resources focus on retirement and savings issues. (Listings do not serve as an endorsement of any resource over another).

Tips icon
  • Save Time - Make a list. Planning eliminates extra trips — grocery, shopping, and errands — due to forgotten items. And when you can, combine trips to save even more time.
  • Save Money - Review two or three of your most recent credit card bills, highlighting all your essential purchases: the non-essential items that remain might surprise you. Prioritize your luxury spending, cutting out the items that you don’t really need.
  • Save for the Future - When buying major appliances such as a refrigerator, washer, dryer or dishwashing machine, spend slightly more now to save more money in the long run on energy and water bills: buy the appliance with the highest ENERGY STAR and WaterSense ratings that you can afford.
  • Save Time - To save time, do your grocery shopping in the middle of the week, when lines are shorter and stores are not as crowded.
  • Save Money - Track all of your spending for two weeks—this includes coffee, magazines, tollbooths, etc. Look at the results and see where you might able to cut back.
  • Save for the Future - Put all your coin change you receive from purchases into a jar. At the end of the month, take the jar's contents to the bank and put it right into savings.
This information is general in nature, is provided for educational purposes only, and should not be relied on or interpreted as accounting, financial planning, investment, legal or tax advice. Regions neither endorses nor guarantees this information, and encourages you to consult a professional for advice applicable to your specific situation.

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