Work?  Retirement?  Something in between?  Know yourself to make the right decision for you!

Working is the new retirement.  True, many people work past “normal retirement age” because they have to to make ends meet, but others continue to work because they want to or, new research shows, because their cognitive skills and personality type impel them to.

Once upon a time, to radically over-simplify, you worked through the Friday after your 65th birthday, had a party and got a gold watch and, the following Monday, began retirement on your front porch rocker.  Now people start to think about retirement around age 55, when most people are still working, and then pursue a of variety of “pathways” until around age 70, when most people are retired. Work and retirement have bled so much into each other that sometimes it’s hard to tell them apart.

Eight Retirement Pathways

Researchers from the RAND Corporation and Netspar (the Network for Studies of Pension, Aging and Retirement, a Dutch think tank) used the U.S. Health and Retirement Study, a longitudinal database of biannual surveys of older Americans, to group Americans in that 55-70 age range into eight retirement pathways.  Looking at individuals who were working full time at “baseline” (55-58), they found that 36.8% transitioned directly to retirement, while another 13.6% experienced a period of reduced employment before fully retiring (“gradual retirement”).  Another 15.9% were working part-time at the end of period, and 16.9% came out of retirement to work full- or part-time at the end of the period. About one in ten–9.8%–worked full time through the entire period. Smaller percentages moved from unemployment or disability to retirement, or followed what the study authors call “complex” pathways.

Cognitive Ability and the “Big 5” Personality Factors

Next, the researchers looked at fluid cognitive ability using a test measuring skills like immediate word recall and “serial 7s” (counting backward from 100 in increments of seven), and scores on the “Big 5” personality factors.  (These are conscientiousness, “the degree to which a person is willing to comply with conventional rules, norms, and standards;” neuroticism, “the degree to which a person experiences the world as threatening and beyond his/her control;” openness to experience, “the degree to which a person needs intellectual stimulation, change, and variety;” extroversion, “the degree to which a person needs attention and social interaction;” and agreeableness, “the degree to which a person needs pleasant and harmonious relations with others.”

Finally, they looked at people’s’ expectations about whether they would be retired at age 62 and 65.  

The analyzed retirement expectations, the pathways people actually took, and psychological data to understand how cognitive ability and personality affected peoples’ course through the transition-to-retirement years, and found some interesting results (published in 2018 in the journal Work, Aging and Retirement):

  • You might expect that extroverts and people with higher cognitive abilities had successful careers and were able to, and did in the end, retire relatively earlier than others.  The contrary was in fact true. All else being equal, they found, “those with higher cognitive abilities are more likely to work longer, more likely never to retire, less likely to retire from a full-time job, and less likely to retire after disability.
  • “Extraversion seems to be strongly related to having part-time jobs, but less related to having full-time jobs.  For example, in the groups with high versus low values of extraversion, 60% versus 51.8% of worker had any job after 65, and 33.4% versus 30.9% had full-time jobs.”
  • Overall, “respondents with greater fluid cognitive ability, those who are more extraverted and those who score lower on agreeableness are significantly more likely to work after age 65… A one standard deviation increase in fluid cognitive ability increases the probability of working after age 65 by 4.3 percentage points from the mean of 55.9% (an increase of about 8%) and the corresponding number for extraversion and agreeableness are 4.3 and -3.1 percentage points.”
  • “Extraverted individuals are somewhat less likely to expect to work longer, but they are somewhat more likely to do so in the end.”
  • “Openness to experience has a positive effect on expectations, even though it did not predict actual retirement outcomes.  People who scored high on this measure described themselves as creative, adventurous, and broad-minded. While it seems reasonable that these people would expect to work full-time longer, it is interesting to find that they failed to do so.”
  • “Those who were more cognitively able, measured using a cognitive ability assessment emphasizing working memory, were more likely to experience a nonstandard retirement pattern, and specifically, were more likely to remain in the workforce after age 70 in either part- or full-time work.”

Chart Your Own Course!

We can’t always control our own employment, but we can create our retirement lifestyle.  You may want to think about how your cognitive skill level and personality type might naturally lead you in certain directions and then go with rather than fight against the flow.  If you’re an extrovert, for example, you might be anticipating spending more time with friends when you retire, but you might in fact be happiest working at least part time.  If your cognitive abilities are high (isn’t that true for all of us?) you might also favor continuing to work or, if you retire, find an activity that recreates a work-like environment in retirement.  (Getting involved with Men’s Sheds or volunteering to serve on a community board might be right for you.)  If you’re high on the openness to experience personality factor, don’t be surprised if you get bored despite an intention to continue working, and get ready to try new things in retirement like drawing or joining a play-reading group.

So what’s the bottom line here?  Don’t be afraid to create your own pathway to retirement, and keep working if you can and want to.  But don’t forget there are dozens of ways in retirement to get the social and cognitive stimulation you used to get at work.

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