Aging America: Seeking softer retirement landing

Phased retirement has been most widespread on university campuses and, to a lesser degree, among government and health care workers. It has been far less common among blue-collar workers.

"Some jobs are rather easy to split," said Robert Clark, a North Carolina State University economist who has written about phased retirement. For example, he said, professors teaching two classes a semester could easily trim their schedules. The salary savings might go toward hiring a less experienced, less expensive instructor.

Many formal phased retirement programs let employees maintain health insurance, vacation and other perks, and continue building up their retirement benefit. Others are more like consulting agreements, with retirees returning to work as independent contractors without benefits.

John Matzeder, compensation and benefits manager at the University of Kansas Medical Center, said phased retirement helps force individuals to think about their post-career lives and determine how they want to spend their time.

"You kind of want to transition into something and do something other than watch TV," he said. "It's a good transition. You're still coming to work, you're drawing a good income, your benefits are not going to change, but you really have to come up with a plan for when you'reretired."

Phil Eckhert, 65, who retired in April from his post as director of housing, community works and transit for Hennepin County, Minn., now works part time under the county's phased-retirement program. It's provided him with a chance to refocus his life, both at work and at home. He has more time for projects around the house and his hobbies of golf and photography. But he also finds new fulfillment on the job.

He'll take calls and offer advice to less senior colleagues, all while enjoying a more limited schedule and a full pension. He had to give up his spacious office for a more modest one, but has also scaled back his responsibilities.

"It's been very nice to focus on a smaller number of things," he said. "I really have liked not having to carry 82 things home in my head at night."

Despite positive experiences around the country and decades of history, phased retirementstill isn't an option most workers have access to.

Dallas Salisbury, president of the Employee Benefit Research Institute, said the economic picture will have to improve for the idea to get a more widespread embrace.

"It will require unemployment to come back down significantly lower and, particularly for the unemployment rates for those coming out of high school and college before there's interest in finding special ways to keep those who want to retire but the company would like to keep around part time," he said.

The idea gained a significant boost last year when Congress passed a law to allow some federal employees participate in phased retirement. With an eye toward a potential mass exodus of baby boomer workers, the U.S. Office of Personnel Management said the goal of the program is to facilitate the mentoring and training of employees' replacements.

That forthcoming expansion could fuel more interest in the private sector, particularly if projections of its cost savings are realized. The Congressional Budget Office estimated phasedretirement would cut federal spending by $427 million over 10 years and increase revenues by $24 million because workers would collect pensions for shorter periods and earn taxable wages longer.

At Stanley Consultants, phased retirees speak passionately of what the program has allowed them to do. Hank Mann, a 72-year-old engineer, cut back to 30 hours a week in the months leading up to his formal retirement last year, and has worked fewer hours since.

He now coaches a swim team with his wife and volunteers harvesting grapes at a local winery. He relishes still being called upon to help with projects, but also enjoys being able to turn them down if he's not interested, an option not afforded during his 52 years of full-time work.

"Now I work on my schedule," he said. "Not the company's."