CARMEL, Ind — The coronavirus pandemic offered a period of reflection for many Hoosiers.
After all, what else were we supposed to do while stuck at home?
Casey Marx is the founder and CEO of Crown Haven Wealth Advisors. Marx said the pandemic served as a realization for many people that they can work from home or reduce hours and still be just as productive at work.
"Maybe I can work 20 hours a week instead of 40 hours a week," Marx said. "Partial retirement has become a thing because of that."
Marx said partial retirement can be as simple as reducing hours to pursue opportunities that improve overall quality of life.
"They will scale back their traditional employment, but then they'll go get a job at the golf course, or they'll go get a job at the nursery, or they'll go spend time at the hospital with the preemies, or any of the things that they really care about," Marx said.
Marx said this kind of realization often occurs as a result of trauma. The coronavirus pandemic acted as trauma on a societal level.
"You have millions of people that have reevaluated what is important to them," Marx said.
For those considering partial retirement, Marx suggested asking a few simple self-reflection questions.
"What's important to you?" asked Marx. "What are you trying to achieve? What do you enjoy doing? Who do you care about? That's your life."
Marx said the reality is retirement isn't always as bright as it seems. When a person retires, the daily sense of fulfillment and the connections with coworkers can be lost.
"It's no joke that when you retire, the odds of depression are increasing by about 40%. Why? You're sitting at home doing nothing," Marx said. "What do you have time to do then?"
To combat that, Marx suggests finding other sources of fulfillment before and during retirement.
"People aren't tired of feeling fulfilled," Marx said. "People are tired of being tired. Partial retirement is beautiful because it is work as a choice, not as an obligation. People are tired of having work be an obligation where they must do 'x' in order to have security and utility of their money."
Another reason Hoosiers decide to partially retire is due to financial constraints.
Nearly 60% of older Americans now expect to delay their retirement plans or enter into a phased retirement due to economic uncertainty and fear of running out of savings.
Marx said a partial retirement could allow them to keep an income while building savings.
"They are the sandwich generation," Marx said. "They are taking care of their parents, and they are taking care of their kids."
Officials at Crown Haven said there are a few topics to consider when debating whether to enter partial retirement:
- Social Security: If you partially retire and want to receive Social Security benefits, keep in mind there are limits and penalties for how much you can earn.
- Health care: Dropping and rejoining Medicare can be a complicated process. Consult a financial professional to avoid any penalties.
- Tax brackets: Carefully track your income and plan accordingly to make sure you are not caught off guard when tax-filing season approaches.
Marx suggests Hoosiers research what available options may best suit them.
"There has never been a time in our lives where we've had access to more information, which is really empowering, but then you have to practically apply the information in a way that is suited completely to what you are trying to accomplish," Marx said.
Crown Haven offers retirement resources on its website, which can be downloaded for free.
Marx said the most rewarding part of his job is helping people discover they can retire.
"They see no end in sight, but they come in, and they talk to me. I show them how they are going to do it, and they can do it, like, tomorrow, because they've done the work already," Marx said. "It's just a matter of using the proper tools."