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“ If you are brave enough to say, goodbye, life will reward you with another hello.” -Paulo Coehlo
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What you gonna do? Walk away, or stay another day?
This blog will look at both options. When considering retirement each person who is currently working must decide how they will quit work and retire. There are multiple options about how to quit work, but only two main choices- quit work quickly, or quit work slowly.
I tend to be a planner (before I was a retirement planner), so for me, retirement was a new adventure that required advanced planning. Except, how does one plan for a destination with unknown expectations?
Quitting work quickly is like planning for a permanent relocation when you don’t know the weather at your destination, local customs, or what activities you’ll be undertaking.
Quitting work slowly is like going somewhere overnight, and then returning for longer and longer periods, until one final permanent move is completed, with incremental visits allowing for better assimilation into a new environment or culture.
In retrospect, quitting work slowly has been a positive and fulfilling experience. I’ve written previously about quitting work in both PHASED RETIREMENT AND OTHER WORK OPTIONS, QUITTING WORK- THE HAMSTER WHEEL, but not specifically about the decision to quit work quickly or slowly. Each option has positives and negatives, and we’ll explore each.
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Quit Work Quickly
For many workers, the last day of work is a day worth celebrating. The required years have been worked, money saved, and walking out the door is an event long sought after. But, what’s next? For some, ripping off the work bandaid is only good if there is something better to replace the pain of working. Arriving at retirement with no plan may be just as painful as continuing to work.
How many workers pre-plan a retirement filled with purpose? My guess is not a majority! Faced with the prospect of filling 24 hours each day with no plan in place, many retirees quickly become disenchanted and discouraged. In the blog QUITTING WORK- THE HAMSTER WHEEL many concrete benefits of working were discussed. Salary and company-funded health, life insurance, and company-sponsored retirement plans cease. Benefits such as paid sick leave, paid vacation, company expense accounts, and company-funded vehicles are no longer available.
In a recent consultation, the concrete benefits of working were not the problem. This person’s primary focus was the loss of security provided by a periodic paycheck, the loss of personal fulfillment, and the social interaction of workplace friendships. Even after a favorable financial consultation, this person was unwilling to forego the stability of an ongoing paycheck.
This person was financially independent but insecure about leaving the workforce and the income it provided. At this juncture, the problem becomes more behavioral than financial. Is there a way to modify this person’s inability to forego the security of an ongoing paycheck? Is there a way to gradually decrease the general dependence on work, and the paycheck that work provides? By gradually reducing the workload, and by default gradually reducing the associated paycheck, the reliance on all the benefits work provides (including a paycheck) is diminished over time.
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Quitting Work Slowly
In the retirement community, the term Glide Path is often used. But, when speaking about a glide path, most discussions center around financial glide paths (The Oxford language dictionary defines a glide path as a series of events or actions leading smoothly to a particular outcome.)
There are also ways to provide a work “glide path” to smooth and gradually diminish the effects of work and the paycheck it provides. In the blog phased retirement and other work options, the concept of phased retirement was briefly discussed. According to OPM.gov phased retirement allows active employees to “retire” from part of their job responsibilities while continuing to execute other job functions such as mentoring and knowledge transfer to employees moving into senior positions.
Through phased retirement workers gradually decrease work responsibilities and hours worked as they approach retirement. Even more important is the ability to gradually decrease the dependency on the benefits and paycheck that working provides. Slowing decreasing the dependency on payment from work also decreases the behavioral attachment to the security that work provides. Slowly working less and less allows a worker to slowly acclimate to life without a paycheck as money derived from work decreases and other retirement funding sources take the place of work-related income.
Roughly 30% of workers would like to decrease hours before retirement, while 15% reported a reduction in hours worked. But, the percentage of workers opting into phased retirement is slowly climbing as the benefits of quitting slowly become more obvious.
There are some potential disadvantages and drawbacks to phased retirement. Phased retirement could potentially impact pension payouts, as rules vary from employer to employer. Pension reductions may occur if pension payments based on earnings result in a reduced benefit. Not every retiree can opt for phased retirement, and generally, phased retirement options are slanted toward higher-level employees.
One of the obvious benefits of self-employment is the ability to self-direct the number and duration of time worked ( phased retirement is much easier to implement for the self-employed.)
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My retirement path has been a glide path to retirement from a full-time practice eight years ago. Each year for the last eight years I have engaged in Locum Tenens dental care. I work approximately one-half of each year as a contract dental provider in area dental offices that provided facilities, staff, supplies, and patients.
Slowly easing into retirement has been beneficial on several levels. The level of stress dropped almost immediately as the mental aspect of both practicing and managing a dental practice was halved after transferring my practice to a younger provider. After the practice transfer my only concern became providing quality care without the burden of managing a business (a dental office.)
My position as a contract dental provider allows me to do what I am trained to do ( providing dental care), remain relevant, and reduce stress while still free of practice management responsibilities. Providing care in totally different dental environments has forced me to become more adaptable while interacting with unfamiliar staff and patients. This type of practice mode has allowed me to develop new friendships and stretch my comfort zone after providing dental care for over forty-five years.
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Is a glide path to retirement the best path for everyone?
The obvious answer is NO! Current information indicates that less than 20% of workers can “quit slowly”, but that percentage is trending upward as businesses explore ways to extend the work careers of highly trained and valued employees (as explored in PHASED RETIREMENT AND OTHER WORK OPTIONS.) More businesses are aware of the embedded skill and knowledge of older workers and of the value of passing this skill and knowledge to the next generation of workers (while retaining their skill-based workers in a reduced capacity.) Self-employed individuals are much more likely to transition towards retirement using a glide path approach as the self-employed have greater control and flexibility.
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How Does This Affect Retirement?
The key to a successful retirement is HAVING A “PLAN”. Someone who has planned properly should have few problems with either approach of quitting quickly or quitting slowly. The problem facing most retirees is a lack of pre-planning for retirement which creates confusion and disheartenment because retirement doesn’t meet expectations. A time of decreasing stress becomes a retirement of increasing stress primarily due to a lack of purpose in retirement.
I suppose that quitting slowly allows potential retirees increased opportunities to slowly transition from a working career to retirement. Workers (on a limited basis) have the chance to experience what retirement entails while still working. This gradual glide path into retirement facilitates the mental and behavioral changes that occur when approaching retirement.
I am currently reading “The Wright Brothers” by David McCullough and was struck by the relevance of the following passage in which Mr. Wright discussed learning to fly. Wilbur Wright compared learning to fly to learning the behavior of an untrained horse. In the book he was quoted as saying:
“This was the kind of horse, he said, that men had to learn to manage in order to fly, and there were two ways:
One is to get on him and learn by actual practice how each
motion and trick may be best met; the other is to sit on the
fence and watch the beast a while, and then retire to the
house, and at leisure figure out the best way of overcoming
his jumps and kicks. The ladder system is the safest, but the
former, on the whole, turns out the larger proportion of good
riders.
If one were looking for perfect safety, he said, one would do well to sit on the fence and watch the birds. “But if you really wish to learn, you must mount A machine, and become acquainted with its tricks by actual trial.”
Mr. Wright understood that safety was a function of observation and inaction while understanding was a function of trial and action. Having a glide path to retirement provides a similar experience of trial and action which occurs before Retirement and while still working. His explanation reveals that the “safe” path of planning for retirement after retiring decreases learning and understanding.
The path of quitting quickly or quitting slowly will be determined by each worker as they approach retirement. (For those workers who haven’t adequately planned for retirement, a gradual glide path into retirement allows experiencing retirement on a limited basis before retiring and may reduce the stress associated with the transition from work to retirement.)
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Final Thoughts
- “What you gonna do? Walk away, or stay another day?” This is the choice every worker will face at the end of their working career.
- Workers have only two main choices when nearing retirement: quitting work quickly or quitting work slowly.
- Quitting quickly may compound the problem of preparing for life without a paycheck. Quitting quickly may also increase the stress associated with leaving the security of workplace salary, relationships, and paid benefits.
- Through phased retirement workers gradually decrease work responsibilities and hours worked as they approach retirement. Even more important is the ability to gradually decrease the dependency on the benefits and paycheck that working provides.
- For those workers who haven’t adequately planned for retirement, a gradual glide path into retirement allows experiencing retirement on a limited basis before retiring and may reduce the stress associated with the transition from work to retirement.
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