{"id":6478,"date":"2017-08-20T06:50:20","date_gmt":"2017-08-20T10:50:20","guid":{"rendered":"https:\/\/kerryhannon.com\/?p=6478"},"modified":"2017-08-20T06:50:20","modified_gmt":"2017-08-20T10:50:20","slug":"why-you-shouldnt-count-on-a-phased-retirement","status":"publish","type":"post","link":"https:\/\/kerryhannon.com\/?p=6478","title":{"rendered":"Why You Shouldn’t Count on a Phased Retirement"},"content":{"rendered":"\n\n\n
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\"\"<\/a>Talk about dashed expectations. A\u00a0study<\/a>\u00a0published recently\u00a0from the Transamerica Center for Retirement Studies (TCRS) finds that 77 percent of employers believe many of their employees plan to continue working after they retire and 47 percent say many of their employees envision a phased transition to retirement. Yet far fewer actually let them keep working for the firms in retirement and\u00a0<\/span>have<\/em>\u00a0a\u00a0<\/span>phased retirement<\/a>.<\/span><\/header>\n
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Only 31 percent of the employers Transamerica surveyed let their employees shift from full-time to part-time and just 27 percent allow them to take on positions that are less stressful or demanding so they can glide into retirement.<\/p>\n

Phased Retirement Programs Are Rare<\/h3>\n

In other words, employees who anticipate a phased retirement by downshifting at their jobs to fewer hours per week are mostly out of luck, according to TCRS\u2019s 17th<\/sup>\u00a0Annual Retirement Survey. Transamerica interviewed more than 1,800 employers of for-profit companies with five or more employees.<\/p>\n

Did I mention that 71 percent of employers Transamerica surveyed said they believe they are \u201caging-friendly\u201d and said they offer opportunities, work arrangements and training and tools needed for employees of all ages to be successful?<\/p>\n

Read on PBS Next Avenue<\/strong><\/a><\/p>\n

What the GAO Report Found About Phased Retirement<\/h3>\n

The Transamerica survey echoed a recent U.S. Government Accountability Office (GAO)\u00a0report<\/a>\u00a0on older workers for the U.S. Senate Special Committee on Aging. That one was called\u00a0Phased Retirement Programs, Although Uncommon, Provide Flexibility for Workers and Employers<\/em>. The title pretty much says it all. But its bottom line, quoting from the report, is that \u201cformal phased retirement programs are relatively uncommon\u201d, yet the availability of phased retirement \u201chas the potential to provide options that would be beneficial both to the older workers and the overall economy.\u201d<\/p>\n

Employers GAO interviewed that did offer phased retirement identified four big benefits for the companies: 1) the retention of knowledgeable, highly-skilled workers; 2) the transfer of knowledge to younger workers; 3) the ability to transition older workers into retirement and 4) the opportunity for workforce planning.<\/p>\n

Why the Disconnect Between Employers and Older Workers?<\/h3>\n

So if most employers think their older employees will want to work in retirement and nearly half think the employees envision a phased retirement, why are so few companies offering one?<\/p>\n

\u201cI have heard anecdotally when talking to employers that many have concerns about opening themselves up to potential liability related to age, ageism and age discrimination,\u201d says Catherine Collinson, president of the Transamerica Institute and TCRS. \u201cOthers are concerned that it would be too disruptive to their overall operations. They want full-time employees at their desks and they just don\u2019t have an appetite to manage a workforce that has a substantial number of part-time workers.\u201d<\/p>\n

From my reporting \u2014 interviewing employers and Sara E. Rix, an employment consultant and former senior adviser with the AARP Public Policy Institute \u2014 I\u2019d take it a step further. Many employers don\u2019t want to offer a phased retirement program that they think could be subject to laws and regulations and could be expensive to administer. They\u2019re not eager to keep paying for the employees\u2019 health and retirement benefits, either.<\/p>\n

The Benefits of Phased Retirement for Employers<\/h3>\n

Maybe they should take a look at the GAO report, which has some great examples of companies with phased retirement that\u2019s working for the firms and the employees.<\/p>\n

\u201cThe GAO report offers a compelling discussion of the need for phased retirement, a concise outline of the obstacles and benefits and examples of how employers have achieved success,\u201d says Collinson.<\/p>\n

Yes, the employers with phased retirement programs reported making some adjustments to address managers\u2019 concerns, the GAO researchers said. For instance, \u201caccording to one employer, work needed to be completed even if some workers reduced their hours, so they set up a \u2018flex team.\u2019 This group of workers is available to fill in as needed throughout the company, and managers can tap it to fill shifts of phased retirement participants.\u201d<\/p>\n

Another approach one employer took, the GAO report said, \u201cis that when a request for phased retirement is made, they look at the current staff roster to see if there is a part-time worker who might want to work more hours or go full-time to fill the gap left by the phased retiree.\u201d<\/p>\n

Little Change in This Benefit\u2019s Availability<\/h3>\n

Sadly, not much has changed in the arena of phased or flexible retirement in recent years \u2014 or lately.<\/p>\n

A Society for Human Resource Management (SHRM)\u00a0study<\/a>, the\u00a02016 Employee Benefits: Looking Back at 20 Years of Employee Benefits Offerings<\/em>\u00a0in the U.S.<\/em>, reported that over the past decade only a relatively small number of members have offered phased retirement programs. Just 5 percent of employers in SHRM\u2019s membership base offer a formal phased retirement program. Moreover, fewer than one percent of SHRM members planned to beginning offering phased retirement programs in 2017.<\/p>\n

\u201cFor the foreseeable future, phased retirement programs are most likely to be adapted by employers who are confronted with an urgent business need to adopt them,\u201d says Collinson. \u201cOne scenario is an employer that finds itself facing the risk of \u2018brain drain\u2019 due to an aging workforce with a critical mass of employees are who nearing retirement. Depending on how it\u2019s designed, a phased retirement program can serve to facilitate a more seamless transition of institutional knowledge between retiring employees and their successors.\u201d<\/p>\n

Reason for Some Optimism<\/h3>\n

But Collinson is somewhat optimistic that phased retirement could gradually pop up at employers around the country.<\/p>\n

\u201cSuccess breeds success. When a high-profile company gains and showcases a major competitive advantage as a result of fully unleashing the power and productivity of its multi-generational workforce, including flexible off-ramps for retiring employees, other companies are likely to follow,\u201d she says.<\/p>\n

Don\u2019t look for a dramatic change in the availability of phased retirement programs soon, however. \u201cEmployers are starting to think about aging friendliness and workers working past 65 or the desire to work past 65. However, that awareness has just not translated into action in terms of business practices, employment practices and retaining older workers,\u201d says Collinson. \u201cThere\u2019s a lot of evidence many employers don\u2019t have practices in place yet.\u201d<\/p>\n

How to Negotiate Your Own Phased Retirement<\/h3>\n

To some extent, it may be up to you to persuade your employer to let you have a phased retirement.<\/p>\n

Such \u201cinformal\u201d phased retirement arrangements are generally more common than formal phased retirement programs, according to the GAO report. In SHRM\u2019s study, roughly twice as many employers said they offered informal phased retirement programs than formal ones.<\/p>\n

To negotiate a phased retirement with your boss, you\u2019ll need to demonstrate that it\u2019ll be worth keeping you on part-time.<\/p>\n

Collinson says this means keeping your skills up-to-date and marketable. \u201cWe live in a time of a very competitive labor market, and we have to be superstars in our jobs each and every day,\u201d she notes.<\/p>\n

I agree. Regularly add to your skill set and push for new assignments. Raise your hand to take part in workplace training efforts, as I wrote in this Next Avenue\u00a0post<\/a>. That adrenaline can translate into more engagement in your job and your enthusiasm can help convince your employer to hold your place on the payroll.<\/p>\n

I\u2019d also recommend tracking down someone at your workplace who is phasing into retirement or did so recently, to get their advice on how the process worked.<\/p>\n

Be precise about what you\u2019re asking for, too. Is it, for example, a three-day week for a set period of time? Or do you want to work from home part-time? At what pay? And what exactly will you do?<\/p>\n

Play up your ability to mentor younger employees while working part-time and offer to try out a phased retirement on a test basis to see if the arrangement is working for both your boss and you.<\/p>\n

One caveat: The chances that you can negotiate a phased retirement may revolve around the kind of work you do. Employers in certain industries are more likely to offer phased retirement even on an ad hoc basis \u2014 particularly those in industries with technical and professional workforces, according to the GAO. Consulting, education, and high-tech are among the fields most likely to offer phased retirement.<\/p>\n

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\u00a0By\u00a0Kerry Hannon<\/a><\/span><\/strong><\/p>\n

Kerry Hannon has covered personal finance for Forbes, Money, U.S. News & World Report and USA Today for nearly three decades. She is the author of\u00a0Love Your Job: The New Rules for Career Happiness<\/a><\/em>;\u00a0What’s Next? Follow Your Passion and Find Your Dream Job<\/a>;\u00a0Great Jobs for Everyone 50+<\/a>\u00a0and\u00a0Suddenly Single: Money Skills for Divorcees and Widows<\/em><\/a>. Her website is\u00a0kerryhannon.com<\/a>. Follow her on Twitter\u00a0@kerryhannon<\/a>.@kerryhannon<\/a><\/span><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n<\/div>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n
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