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What is semi-retirement and why is it a growing trend?

RBL Bank Mar 02, 2020

The ancient Chinese philosopher Confucius is widely credited to have said, “Choose a job you love and you’ll never have to work a day in your life.” His remedy seems simple, but how many people have a job they love? According to a Times Jobs survey, nearly 80% of Indian employees are dissatisfied with their jobs. What are the options if you have to spend a lifetime doing a job you don’t like? You can change the job, but it is not easy. Another option is to look forward to your retirement, after which you can freely pursue activities you like. However, rather than retiring completely and foregoing all sources of income, many people are opting to retire partially and continue earning.

The contemporary practice of retiring early but continuing to work in order to generate an income is known as semi-retirement. It entails having similar work with reduced timings or entering a completely different occupation. Semi-retirement is essentially a transitory phase between full-time work and complete retirement. The number of people opting for semi-retirement is growing rapidly. A wide variety of factors ranging from technological and economic changes to personal reasons are fueling the semi-retirement trend.

Let us take a look at the reasons responsible for the growing acceptability of semi-retirement among Indians.

Improving life expectancy

One of the biggest fears among retirees is that they may outlive their retirement corpus. The retirement corpus will fall short only if there is a significant improvement in the lifestyle or if the retiree has a longer life span. Life expectancy has improved drastically in India. Though it signals towards better health care services and nutrition, it also has a negative consequence—retirement planning has gone haywire. Earlier, people had to plan for a post-retirement life of 10-15 years, but now it has expanded to 20-25 years. The additional years take a monetary toll on the retirees, forcing them to work even after retirement. Many people work after retirement just to ensure a stress-free and financially stable post-retirement life.

retirement ageimage source: News18.com

Change in job ecosystem

With the slowdown in the economy, companies are turning towards experienced hands to stabilise the ship. Older people are increasingly finding more job opportunities as companies seek to increase operational efficiency. Senior citizens are known to work harder and are more disciplined than their younger counterparts. Moreover, sectors, where experience is a major consideration such as education and healthcare, have always been the favourite destination for retirees. The cost of hiring senior citizens is lower for the companies as they are willing to work for lower wages. The changes taking place in the job ecosystem has made it easier to retire and still lead a comfortable life.

Technological changes

The spread of the internet to every nook and corner of the country has changed the dynamics of employment. Availability of reliable internet network has given rise to the ‘gig economy’, and senior citizens have been one of the unlikely beneficiaries of the gig economy. It has become easier to get location-independent work such as that of a consultant or a photographer for semi-retirees. The easy availability of work with flexible work timings has led to many people opting for semi-retirement.

semi retirement

Alternate career

During the working years of life, one has to look after the kids and the family. The burden of responsibilities forces people to stick to their existing jobs. But when people reach near retirement and have no responsibilities, they take the risk of entering an alternate career. Semi-retirees utilize the skills honed over several years to explore sectors they had no prior experience in.

Changing societal norms

In India, parents use to depend on their children for post-retirement expenses. But with changing family structures, many retirees are losing that cushion. Families are getting smaller with children and parents living in separate houses. The absence of a family support system has resulted in many senior citizens fending for themselves and taking up jobs to support himself-herself and their spouse.

Conclusion

A host of reasons are propelling the practice of semi-retirement in India. However, working after retirement is not an alternative to retirement planning. Without proper investments for old age, no income will be enough. You can opt for RBL Bank’s wealth management services to invest efficiently for the post-retirement life. To know more, please click here.

Disclaimer: Articles published on the website are merely indicative and suggestive in nature and do not amount to solicitation. The contents do not guarantee the desired returns and/or results. Reader is advised to exercise discretion and consult independent advisors for achieving desired result. Visitors to this blog/ website w.r.t products & services offered by RBL Bank Limited herein, shall ensure that the comments / feedback posted shall be restricted to the contents published herein and shall not contain such language that may be un-parliamentary or against any religion, caste, section of society, political view etc. While our endeavor is to publish the comments that are submitted, however, all comments/feedback shall be subject to internal review by RBL Bank Limited. We do not guarantee that the comments that are submitted will be published.

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