Is “Flextirement” the New Work Trend to Ease into Retirement?

An estimated 10,000 baby boomers reach retirement age every day. But for many in this generation, the idea of an abrupt end to their careers feels less like a dream and more like a jarring loss of identity and purpose. 

Enter “flextirement,” a gradual transition from full-time work to retirement that’s becoming an increasingly popular alternative to retirement.

The older workforce is growing. Today, over 10 million Americans aged 65 or older are working, which is expected to increase to nearly 15 million by 2032. According to HBR, 27% of Americans aged 65 to 74 are working or actively looking for jobs, up from 20% in 2002.

Flextirement offers a way to achieve a better work-life balance, maintain social connections, and continue earning income while scaling back work responsibilities. It’s also an opportunity for employers to retain experienced workers, bridge knowledge gaps, and demonstrate their commitment to supporting employees at every stage of their careers.

So how exactly does flextirement work? What are the benefits for employees and employers? And how can you tell if it’s the right path for you? 

What Exactly Is Flextirement?

Flextirement is a term for a flexible, personalized transition from full-time work to retirement— also called semi-retired or phased retirement. Rather than a sudden shift from 40+ hour workweeks to full-time leisure, flextirement allows you to gradually reduce your hours and responsibilities over months or years while still receiving some compensation and benefits.

AARP asked retirees if they preferred a phased retirement, and 40% said they would have preferred it. 

The demand for flextirement is growing as more individuals seek alternative work arrangements to transition into retirement.

How Does Flextirement Differ From Traditional Retirement? 

With traditional retirement, you generally work full-time until a set retirement date and then abruptly stop working altogether. There’s little to no transition period.

Phased retirement programs, where they exist, can offer some flexibility. However, these arrangements are often informal and inconsistent and are only available to a select few employees. 

Flextirement, by contrast, is envisioned as a more structured and widely available option. The goal is to create individualized plans that meet the needs of both the employee and the employer.

Key characteristics of flextirement:

• Reduced work hours and responsibilities over time
• Prorated compensation based on part-time schedule 
• Continued access to some or all benefits
• Option to work remotely for some or all hours
• Tailored to individual preferences and circumstances

For example, a flextirement plan might allow you to:

• Scale back from 5 days a week to 4, then 3 over the course of a year 
• Receive 80% of your salary while working 80% of your former hours
• Maintain full health insurance coverage during your transition
• Shift to a part-time remote schedule for better work-life balance
• Focus your reduced hours on high-impact projects or mentoring

The exact structure of a flextirement arrangement would depend on your specific role, goals, and company policies. But the common theme is a gradual, flexible “glide path” into retirement rather than an abrupt hard stop.

The Perks of Flextirement for Employees

So what’s in it for you as a baby boomer employee? Quite a lot, as it turns out. Here are some top benefits of easing into retirement with a flextirement plan.

A Smoother Transition

One of the most significant advantages of flextirement is the ability to gradually adjust to a new reality. Rather than going from 100 to 0 overnight, you can slowly scale back your work hours and responsibilities over time. 

This allows you to:

• Adapt to a new schedule and lifestyle at your own pace
• Avoid the potential shock and loss of identity that can come with abrupt retirement
• Gradually explore new hobbies, interests, and social circles

Imagine being able to spend more time with family, travel, or pursue passion projects while still maintaining a foothold in your career. Flextirement can provide that kind of flexibility and control.

Continued Purpose and Engagement

For many boomers, work is about more than just a paycheck. It’s a source of meaning, fulfillment, and social connection. Flextirement allows you to preserve those benefits while still gaining more personal time.

A 2018 study revealed that 56% of workers over 50 had been involuntarily pushed out of their jobs before they would have retired. Continuing to contribute your skills and experience on a part-time basis can:

• Stay engaged in work you find meaningful
• Maintain rewarding relationships with colleagues 
• Continue to learn and grow professionally
• Share your knowledge with younger generations

Financial Stability

Of course, the financial benefits of flextirement should be considered. By continuing to earn income for longer, you can:

• Boost your retirement savings
• Delay drawing down your existing nest egg
• Cover healthcare costs or other expenses
• Maintain employer-sponsored benefits like health insurance

This can provide peace of mind and greater financial flexibility as you transition to full retirement.

In the next section, we’ll examine how flextirement can also benefit employers and why that’s good news for experienced workers hoping to take advantage of this option.

How Does Flextirement Benefit Employers?

While flextirement offers clear employee benefits, it’s also a company win. By embracing this model, organizations can:

Retain Valuable Knowledge 

Baby boomers are the keepers of decades of hard-earned skills, insights, and institutional knowledge. When they retire abruptly, that wisdom often goes with them. 

Flextirement allows employers to retain access to boomers’ expertise part-time. This can help maintain productivity, problem-solving capabilities, and work quality, even as experienced workers scale back their hours.

Facilitate Smooth Succession Planning

Another key advantage is the ability to strategically transfer knowledge to the next generation. With a flexible retirement timeline, baby boomers can gradually hand off responsibilities to younger colleagues and provide invaluable mentoring.

This helps ensure continuity and prepares new leaders for success without the abrupt loss of guidance that can occur with traditional retirement models.

Enhance Employer Brand

Companies that offer flextirement also stand to enhance their reputation and appeal to top talent of all ages. Organizations can differentiate themselves as progressive employers of choice by demonstrating a commitment to supporting workers across the lifespan and helping them navigate major transitions. 

This can give them a competitive edge in attracting and retaining both older workers and younger generations who value flexibility and work-life integration.

Structuring a Flextirement Arrangement

So what factors should you and your employer consider when crafting a flextirement plan? While the specifics will vary based on individual needs and circumstances, some key elements to address include:

• The scope of reduced hours and responsibilities over time 
• Compensation and benefits adjustments tied to part-time status
• Flexible scheduling and remote work options 
• Expectations around high-priority projects and knowledge transfer
• Opportunities for mentoring and advisory roles

The most effective flextirement plans will be highly individualized, considering your unique goals, lifestyle, health needs, and organizational role. It’s also wise to build regular check-ins to assess how the arrangement works and adjust the course as needed.

Tips for Pursuing Flextirement

If you’re intrigued by the potential of flextirement, what steps can you take to explore this path? Here are some key strategies:

Start the Conversation Early

Don’t wait until you’re on the brink of retirement to discuss a flexible transition. Plant the seed with your manager and HR team well in advance so there’s ample time to plan and navigate any logistical hurdles.

Frame the conversation around the mutual benefits for you and the company, emphasizing your commitment to supporting a smooth transition and knowledge transfer process.

Do the Financial Legwork

Before pursuing flextirement, it’s essential to crunch the numbers and ensure the model will work for your financial goals and obligations. Consider consulting with a financial planner who specializes in retirement to:

• Project your income and expenses under different flextirement scenarios 
• Assess the impact on your Social Security benefits and retirement account withdrawals
• Identify strategies to maximize your savings and protect your nest egg as you scale back

Plan for Work-Life Balance

A phased retirement can offer greater work-life integration, but it also requires careful boundary-setting to avoid the trap of working full-time hours for part-time pay.

Proactively carve out dedicated time for family, leisure, and personal pursuits. Set clear expectations with your employer about your availability and stick to them. And remember to prioritize your health and well-being as you navigate this new chapter.

The Future of Work: Flextirement

While formal flextirement programs are still relatively rare, that’s likely to change in the coming years. As more baby boomers approach retirement age and seek greater flexibility, employers will face mounting pressure to adapt.

Some progressive companies are already leading the charge. One example is HireClix, a digital recruitment marketing agency where CEO Neil Costa has implemented a formal flextirement program. The goal is to help retiring boomers scale back gradually while maintaining health insurance and passing on their skills to younger workers.

Costa explains, “When we think of normal retirement, it’s an on/off switch, and it’s someone checking out and going off into the sunset. We’re trying to define a new employment status where you’re still an employee and can still take advantage of the benefits and still have a more intimate relationship with the company.”

The viability of flextirement will vary by industry and role, with knowledge workers and non-client-facing positions seen as strong contenders. Small and mid-size companies may find it easier to tailor offerings than larger, less nimble organizations.

But regardless of sector, the fundamental need for a new retirement paradigm is clear. With workers living longer and healthier lives and many boomers seeking a more individualized transition into their next chapter, the traditional binary of 100% work or 100% leisure is losing relevance.

A New Way Forward

For baby boomers who’ve spent their careers following a linear path to retirement, flextirement represents an exciting, albeit unfamiliar, new frontier. Combining the structure and stimulation of work with the freedom and flexibility of retirement offers the best of both worlds.

Considering a phased, personalized transition to retirement? With more companies recognizing the value of retaining experienced talent, a flexible “second act” career is more achievable than ever. By championing this new retirement model, you’re creating a path for yourself and future generations. 

If this idea intrigues you, explore your options—flextirement may be the key to making your retirement truly shine.