5 Alternatives to Traditional Retirement

Source:http://money.usnews.com/money/retirement/articles/2010/06/07/5-alternatives-to-traditional-retirement.html
Traditional retirement generally requires us to work and save consistently for 30 or 40 years so we can have an extended period of leisure in our golden years. But there are other ways we could allocate work and leisure time throughout our lives. Some people take sabbaticals, mini-retirements, and other career breaks in exchange for working until older ages or even indefinitely. "Retirement is becoming a temporary hiatus, akin to a sabbatical, and then it's being moved to a point later in life where it will likely be 10 years as opposed to 30," says Marc Freedman, founder and CEO of Civic Ventures and author of Encore: Finding Work That Matters in the Second Half of Life. "People want to take these breaks to get some rest and relaxation before moving on to another phase in their working life." Here are a few alternatives to traditional retirement.
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Sabbaticals. Some companies allow workers to take a sabbatical and then return to their job. Teresa Engebretsen, 51, a private middle school French teacher in Durham, N.C., took a sabbatical with full pay from June 2008 to December of that year. During that time, she worked as a chef's assistant at a bed and breakfast in Arles, France. She has since returned to teaching, newly energized. "I was there long enough to get to know more people and not just to be a tourist, but to feel comfortable," says Engebretsen. "I want my students to get outside their comfort zone and see what else is out there too." While paid sabbaticals can be more difficult to obtain given the economic decline, there may increasingly be opportunities to negotiate for extra unpaid time off, which benefits employers looking to save money, too. A 2009 Towers Watson survey of human resources executives found that 53 percent plan to offer employees voluntary unpaid sabbaticals or furloughs.

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Mini-retirements. Some people try to space extended periods of leisure time—often called mini-retirements—throughout their lives instead of retiring in their 60s. "From a practical and financial standpoint and philosophical standpoint, it makes sense when possible to try to carve up retirement into smaller pieces," says Timothy Ferriss, author of The 4-Hour Workweek: Escape 9-5, Live Anywhere, and Join the New Rich. He says a mini-retirement should last a minimum of four weeks. "No combination of two-week vacations has the impact of one two- or three- month mini-retirement," Ferriss says. Individuals should remove themselves from their daily routine and try to avoid cell phones and E-mail as much as possible during this period. The goal: "You step outside of a reactive lifestyle and are able to take a fresh look at things with new ideas," Ferriss says.

Tina Su, 30, of Seattle, a former software engineer for Amazon, has taken two three-month mini-retirements in India. "I enjoyed my job, but I didn't like that I only had three weeks of vacation every year," Su says. "I just felt there is more to life than that and I wanted to explore."

Focused career breaks. Joe Flood, 43, a Web editor in Washington, D.C., has taken four career breaks of approximately three to six months each, usually to accomplish a specific project. In November 2008, he left his job as a website manager to write a mystery novel, Murder in Ocean Hall. "I've done it because I needed time to pursue my own interests," says Flood. "I think it is better to space out retirement throughout your life." Although he has worried about the gaps in his resume, Flood says employers have not been put off by them. "People have been impressed by that because it shows initiative and that I can work independently," Flood says.

Second careers. Career breaks can be used to transition into a new and more enjoyable job. "I think we are going to see adult education and recareering and personal reinvention become a standard part of the later years," says Ken Dychtwald, president of the consulting firm Age Wave and author of With Purpose: Going From Success to Significance in Work and Life. In November 2008, Trent Dyrsmid, 40, of San Diego sold the technology company he founded and managed. He then took a year off to relax, network, and retool to become a real estate agent. "I like tackling challenges. I image I will keep working as long as I live," Dyrsmid says. "The idea of not doing anything doesn't particularly appeal to my desire for intellectual stimulation, but I definitely would like to take another mini-retirement."
Entrepreneurship. Some people don't want to retire completely, but wouldn't mind having more control over how they spend their time. "Most of my clients use a sabbatical to make a shift in career that is toward something that is more relevant personally and societally and it usually involves something more entrepreneurial," says Clive Prout, a San Juan Islands, Wash.—based sabbatical life coach. "Move towards the job you want now rather than working at something that you don't want in the hope that you can save enough to retire later." The baby boomers' decades of experience and lifetime's worth of accumulated friends can give them a huge advantage in starting a business. Those between ages of 55 and 64 had highest rate of entrepreneurial activity over the past decade, according to a recent study by the Kauffman Foundation.

Margery Miller, 62, of Dallas, Texas, currently works between 15 and 30 hours a week as a consultant and coach for her own consulting company, PeopleBiz. She sold her 29-year-old manufacturers' sales agency in November 2006. "I now know that I won't ever retire," says Miller. "I'm not saying that I want to go back and run another sales agency, but I'm busy in a way that works for me."