Could The Great Retirement be followed by the Great Returnship?

Will high inflation, volatile investment returns and soaring interest rates tempt new and recent retirees into “returnship,” or returning to the workplace?

That’s a view expressed in an article by Brian J. O’Connor, writing for SmartAsset via Yahoo! Finance.

“Retirees who find themselves hit by higher prices, lower stock returns and big health care bills might consider boosting their bank accounts by heading back to work – and employers are waiting to welcome older workers back with open arms,” he writes.

“Big health bills” are more of a U.S. problem than one we Canadians face, although long-term care costs can be eye-opening even here.

The article suggests having the option of returning to work could be a “linchpin” for your retirement plan. That’s because your work experience is more highly valued than ever thanks to the lack of new folks coming up the system to fill your job, the article continues.

“These employees are valuable because they are seasoned, and that’s not always easy to find today,” Charlotte Flores of BH Companies states in the article.

The article goes on to note that of the five million Americans who left the U.S. workforce during the pandemic, “more than two-thirds were over 55.” Now there are five job openings for every three U.S. workers.

“Employers are not only eager to hire experienced older workers, but they’re also open to bringing in retirees who’ve been out of the workforce for several years,” the article continues.

This rehiring of otherwise retired workers is called a “returnship,” the article explains. Large U.S. companies, such as Goldman Sachs, Accenture, Microsoft and Amazon have developed “returnship” programs.

“The programs are designed to give returning workers training, mentoring, a chance to learn or brush up on skills and lessons on how to navigate the current work culture. The trend is so strong that there even are “career-reentry” firms that specialize in connecting employers with returning workers, such as iRelaunch, which works with 70 companies offering returnships, including posting openings,” the article states.

Another benefit of going back to work after retirement, the article says, is that you can either “delay or reduce withdrawals from retirement accounts,” a decision that “stretches out your retirement nest egg to lessen your longevity risk.”

Here in Canada, that certainly would be true of any withdrawals from a Tax Free Savings Account or from a non-registered investment account. We have heard of defined benefit pension plans in Canada that permit you to stop receiving pension payments (temporarily) if you return to work – and let you resume contributions. We haven’t heard of there being ways to temporarily pause withdrawals from a registered retirement income fund (RRIF), however.

Many observers here in Canada have talked about making it possible to delay RRIF withdrawals, and continue to contribute to RRSPs, until later in life. Save with SPP spoke to Prof. Luc Godbout on this topic in the spring.

It sure seems like the old days of full retirement – our dad left work at 62 and never did a single lick of work again for the remaining 27 years of his life – may be gone forever. Not saying that’s a bad thing – a little work keeps your mind sharp and social contacts alive – but the concept of full retirement at 65 does not appear to be as likely in the 2020s as it was 30 or 40 years ago.

Whether or not you plan to fully retire in your 60s, 70s or later, you’ll need some retirement income. Most Canadians lack workplace pension plans and must save on their own for retirement. Fortunately, the Saskatchewan Pension Plan is available to any Canadian with RRSP room. This do-it-yourself pension plan invests the contributions you make, pools them and invests them at a low cost, and at retirement, turns them into an income stream. You can even get a lifetime annuity! Check out this wonderful retirement partner today!

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By Sheryl Smolkin

Traditionally in the U.S., the Friday after Thanksgiving (the fourth Friday in November) is the kick off for the Christmas shopping season. However, over the last several years many Canadian retailers have jumped on the bandwagon, offering competitive deals.

In fact, data from Consolidated Credit and Moneris based on the 2014 Black Friday/Cyber Monday weekend show that shoppers in Saskatchewan spent the most, with the average credit or debit transaction ringing in at $140.81. Alberta was a close second, charging an average of $126.41 to plastic.

According to a 2015 survey by Accenture, Canadian consumers perceive Black Friday to be the day with the best deals (37%), followed by Boxing Day (25%) and Cyber Monday (11 per cent). However, more shoppers say they plan to shop on Boxing Day (64%) than Black Friday (60%). Cyber Monday still hasn’t fully caught on with Canadian shoppers, with only 31% saying they plan to shop on the first Monday after U.S. Thanksgiving.

Twenty-seven percent said they would travel to the U.S. to shop, compared to 24% in 2014. Thirty-one percent of shoppers cited the weak Canadian dollar as their reason for staying put to shop this year.

Whether you plan to shop online or in person, here are some hints to get the best Black Friday deals:

1. Make a list: Just like you make a grocery list before you go shopping, think about what you are really looking for before you sit down in front of your computer or get up at the crack of dawn to stand in line at the nearest big box store. 
2. Pre-shop: A deal is only a deal if you really need the item and the price is actually lower than any other day of the week. Price clothing, small electronics and other products in advance so you know whether or not specials offered actually represent good value.
3. Free shipping: If you are shopping online, check out how much the shipping charges are before you press the button to buy the items in your shopping cart. In Who’s offering free shipping this Black Friday? the website Shopbot predicts which bricks and mortar stores will likely offer free shipping based on whether or not they did last year.
4. Keep your receipts: The pair of shoes or winter coat you bought after standing in line may not be such a great fit once you get them home. Make sure you understand the return policy and keep your receipts in case items have to go back.
5. Timing: Online Black Friday sales often start at midnight on Thursday EST. If you are in Saskatchewan, that’s an hour earlier. Grab your cup of coffee and stay up late to be first in line to get the loss leader deals.
6. Create an account: If there is a site you know you will want to buy from, create an account earlier in the week. That way you won’t waste precious time filling out forms and lose coveted items that are in limited supply. 
7. Cross-border shopping: If you plan to brave the lines and head south to do your Black Friday or Cyber Monday shopping, don’t forget to use the calculator or currency exchange app on your phone. When you take the soft Canadian dollar into consideration, what looks like a great deal may not be.
   

Also see:

Who’s offering free shipping this Black Friday?