APA Center for Organizational Excellence: Good Company Newsletter: The Double-Life of Pre-Retirement: Balancing Work and Planning for the Transition

December 1, 2010

The Double-Life of Pre-Retirement: Balancing Work and Planning for the Transition

By Patricia G. Bagsby & Matthew J. Grawitch, PhD

With economic ups and downs, retirement has been drawn to the forefront of people’s minds. In reality, concern over being “ready” to retire is not a new concept. Unfortunately, decades of anecdotal evidence and prescriptions for successfully transitioning to retirement have not equipped pre-retirees with the ability to assess their own retirement planning success.

Even with a plethora of personal stories and advice from friends, colleagues and family members, about one third of workers experience a negative impact on their well-being once they cease working (Bosse, Carolyn, Levenson, & Workman-Daniels, 1991; Turner, Bailey, & Scott, 1994; Wang, 2007). With the vast amount of research on the topic, what are we doing wrong? Are we not asking the right questions? Have we missed something with regard to retirement stress? The answer may be in the way researchers have approached the topic.

Stress and anxiety related to retirement have been studied in a very simplistic fashion, with blame placed on specific aspects of the work environment (e.g., control over retirement timing, the manner in which workers retire; De Vaus, Wells, Kendig, & Quine, 2007) or personal characteristics of the retiree (e.g., Big Five personality factors; Robinson, Demetre, & Corney, 2010). Additionally, although it has received much less empirical attention, workers experience retirement-related stress well before they actually leave their employers.

Pre-Retirement

The timeframe when the reality of impending retirement has become salient (usually around age 50) and the worker is actively engaged in planning for the transition to retirement can be plagued by ambiguity, stress and general declines in well-being (Glamer, 1980; Wang, 2007). Stress is likely caused by pre-retirees struggling with how to balance aspects of their current work life, adjusting to current or impending changes within relationships and beginning the path to learning how to be a “retiree.”

What is truly lacking in the conversations about retirement is a more realistic way for pre-retirees to evaluate both their progress toward retirement goals and the effect that pre-retirement may have on current work life, which may help alleviate stress before and after retirement. Although there are as many “ideal” ways to plan for retirement as there are pre-retirees, at the core of each worker is this basic reality: all workers have a finite amount of resources and a variety of demands competing for those resources (Grawitch, Barber, & Justice, 2010). Pre-retirees need a more holistic way to approach the way they evaluate resources available for retirement planning, especially in light of the fact that this period of a worker’s career is one in which balancing work and non-work issues becomes more and more salient as the amount of time before retirement shrinks.

Recent theoretical work in the area of the work-life interface provides pre-retirees exactly that, a more comprehensive way of evaluating their lives during pre-retirement and a way to evaluate the potential success of pre-retirement planning processes. As pointed out in the Personal Resource Allocation (PRA) framework (Grawitch, Barber, & Justice, 2010), work and non-work are part of the larger life domain. Although researchers often try to segregate the two, the reality is that workers are all trying to manage one thing, life in general. A major benefit of applying the PRA framework to pre-retirement is that the approach acknowledges that how individuals meet their life demands is highly individualistic. All individuals vary in their amount of basic resources (time, energy, finances). In addition to differing resources, no two pre-retirees will have the same demands or responses to those demands.

All life demands require the pre-retiree to make resource allocation decisions, whether these are preferred demands (e.g., planning for travel post-retirement) or required demands (e.g., planning how to train the coworker who is in line to take over the pre-retiree’s job). For pre-retirees, current work demands and demands related to preparing for the future will pull from a worker’s pool of finite personal resources (especially time and energy). According to the PRA perspective, managing demands across the life domain with regard to preferences, resources and expectations is the key to successfully managing pre-retirement. Therefore, evaluating these aspects of an individuals’ life in pre-retirement can potentially serve as a way for pre-retirees to assess barriers and facilitators in their process of preparing for retirement, as well as identify ways to manage demands of the current work role.

How can pre-retirees use the Personal Resource Allocation framework to their benefit?

The first step is to assess current resource allocation. Some questions to ask include:

• Are you accurately assessing your resources? Evaluate the amount of actual time you have left in your current job, the financial resources available to you both now and post-retirement, how much energy you have (e.g., physical energy, motivation) and what seems to drive most of your energy.
• Are you accurately assessing your demands? Most employees spend a good deal of time measuring in some way their required demands (e.g., how much time is spent doing things you do not like that take away from the things you want to do), but it is also important to assess the toll that is taken by preferred demands as well.
• How do you respond when the resources required by life demands exceed your current resource availability (e.g., you are too tired to do something or lack sufficient money to purchase something)? Do you tend to withdraw? Do you avoid certain situations or people? Does your mood suffer? Recognize these patterns as warning signs that you need to reassess the way you allocate your personal resources.

The next step is to focus on the things you can change. This includes the following considerations:

• Do not ignore psychological well-being. Make smart financial decisions, but also make smart psychological decisions (which includes being honest with your resources and demands). Weigh the outcome for your well-being just as much as your wallet.
• Pay attention to your finite resources. As the countdown draws to an end for the last day of work, time and money are extremely fixed. However, energy can be increased through healthy habits such as eating well, exercise and good sleep habits.

Additionally, employers play a significant role in the way their employees approach pre-retirement. Specifically, employers need to recognize the potential for burnout for employees going through the transition to retirement. Keep in mind that managers can also get overwhelmed with the idea of preparing to lose long-term employees. They may shift their focus instead to knowledge management, trying to glean everything they can from pre-retirees before they leave. Either because of the stress over the countdown to the employees’ departure or other demands, some managers can be blind to the delicate balancing act pre-retirees engage in while trying to stay invested in work and at the same time trying to psychologically prepare for life without work. As pre-retirees continually pull from the same resource pool to engage in this ‘double-life,’ there is a great potential for individuals to become burned out. Once burnout occurs, employees are more likely to withdraw from work instead of planning for retirement, because retirement is the greater stressor.

How can managers deal with the pre-retirement issues of their employees?

• Acknowledge the added stress your pre-retiree workers are under. Express your concern for pre-retirees’ well-being as they are balancing both old and new roles.
• Find ways to help pre-retirees manage the stress of dealing with work and non-work demands in order to keep them as invested as possible. Either through formal or informal means, offer employees a variety of ways to reflect on this process before it becomes an issue of demands outweighing resources.

Pre-retirement is a timeframe in a worker’s life that is often overlooked. Pre-retirees and managers can sometimes approach this phase as “business as usual.” In reality, these workers are in the middle of a very important balancing act. The Personal Resource Allocation framework offers a holistic way for pre-retirees to evaluate their approach to retirement planning, taking into consideration the multitude of demands in current life from work and non-work.

A more complete picture of available resources and current demands is likely to have a positive impact on pre-retirees by encouraging more conscious resource allocation, thus decreasing the likelihood of burnout. Managers can benefit as well because pre-retiree workers will be more likely to stay engaged throughout their transition to retirement.

References

Bosse, R., Carolyn, M.A., Levenson, M.R., & Workman-Daniels, K. (1991). How stressful is retirement? Findings from the normative aging study. Journal of Gerontology: Psychological Sciences, 46, 9-14.

De Vaus, D., Wells, Y.Aging & Society, 27, 667-682.

Glamser, F. D.(1981). The impact of preretirement programs on the retirement experience. Journal of Gerontology, 36, 244-250.

Grawitch, M. J., Barber, L. K., & Justice, L. (2010). Rethinking the work—life interface: It’s not about balance, it’s about resource allocation. Applied Psychology: Health and Well-Being, 2, 127-159.

Robinson, O.C., Demetre, J.C., &Corney, R. (2010). Personality and retirement: Exploring the links between the Big Five personality traits, reasons for retirement and the experience of being retired. Personality and Individual Differences, 48, 792-797.

Turner, M.J., Bailey, W.C., & Scott, J.P. (1994).Factors influencing attitude toward retirement and retirement planning among midlife university employees. Journal of Applied Gerontology, 13, 143-156.

Wang, M. (2007). Profiling retirees in the retirement transition and adjustment process: Examining the longitudinal change patterns of retirees’ psychological well-being. Journal of Applied Psychology, 92, 455-474.

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