The Rise of Semi-Retirement

June 22nd, 2015

When I started working in the retirement planning business, I was surprised to learn that a significant percentage of my clients were not planning on retiring in the stereotypical way of giving up on work entirely and that many clients were aiming for what could be called a semi-retired lifestyle. A recent Hong Kong and Shanghai Bank Corporation survey of 1,000 Canadians had some interesting results in this regard.

The people that were semi-retired were asked the question “Why did you move from working full-time to semi-retirement, before retiring fully?”

Here are the results for people who semi-retired by choice.

Didn’t want to retire full-time immediately (38%)
Keep active/keep my brain alert (37%)
Liked working (35%)
Wanted an easy transition into retirement (26%)

People who were semi-retired by necessity gave the following reasons.

To reduce stress (28%)
Health reasons/physical demands (18%)
To maintain comfortable lifestyle (17%)
Could not afford to fully retire (12%)

In the HSBC survey, people who were able to realize their hopes and aspirations reported the following.

Spending more time with family and friends (58%)
More frequent holidays (45%)
Home improvements, gardening (38%)
Extensive travel (36%)
Charity/volunteer work (30%)
Indulging in luxury items (22%)
Continuing to work to some extent (16%)
Learning a new skill/hobby (14%)

This list has a lot of items that look familiar to what I see in my practice.

The report also states that 56% of respondents have failed to realize at least one of their hopes or dreams for retirement. Heading the list are extensive travel, frequent holidays and opportunities to live abroad.

When considering your lifestyle and financial plans for retirement, it’s important to explore the possibility of semi-retirement as an option to achieve your hopes and dreams.