A majority of American workers plan to continue working after retirement.

In general, retirement is considered as not working anymore, although people have varying definitions for it.

According to CNBC's August 2024 Your Money retirement survey conducted with SurveyMonkey, 71% of currently retired people are not working in any capacity, while 17% say they're working by choice and only 11% report working because they have to.

According to a survey by CNBC, only 11% of future retirees do not plan to work after retirement. About 36% are unsure, while the majority, 53%, anticipate working, either to relax or to supplement their income.

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According to Jamie Bosse, a certified financial planner and senior advisor at CGN Advisors in Manhattan, Kansas, working in retirement may be a smart decision for younger retirees not only financially but also personally.

"Retirement can be unappealing to many individuals initially, as their sense of identity is often tied to their work. This can lead to an identity crisis, causing them to question who they are without their job. As a result, many people seek to maintain some form of work or routine during retirement."

Here's why it could be a smart thing to plan on.

Delaying full retirement shifts the odds in your favor

A recent study by Morningstar's researchers revealed that 45% of American households may face financial shortages during retirement.

According to Spencer Look, associate director of retirement studies at Morningstar Retirement, staying at your job longer or picking up some working income in retirement can significantly increase your chances of making your money last as long as you need it.

According to Morningstar's model, only approximately 28% of households will be insufficient in retirement if they retire at 70, compared to 45% if they retire at 65.

""Retiring at 70 can be dramatic for some people, but it's not possible for everyone. Even working part-time if you don't have enough savings can be helpful," Look recently told Make It."

Working longer allows you to save more money in retirement accounts and withdraw less, resulting in a shorter retirement.

Delaying retirement can increase another form of income after working years: Social Security. For individuals born after 1960, full benefits, which are intended to replace approximately 40% of pre-retirement income, are available at age 67. If you choose to retire before age 67, you will receive a reduced payout. On the other hand, if you wait until age 70, the Social Security Administration will increase your benefit by 8% for each year you delay.

Working in retirement can be fulfilling

Approximately half of the 53% of retirement savers who plan to work in retirement require the additional income, while the other half do so because they believe they will want to.

A job in retirement doesn't have to be something you dread, says Gerika Espinosa, a CFP with DMBA in Salt Lake City, Utah.

"Getting over the belief that we must have jobs we don't enjoy can greatly benefit people in retirement who often struggle with finding purpose."

Espinosa presents the income shortfall for clients who are not meeting their retirement income goals, which may be considerably less than their previous full-time career earnings.

She says, 'It changes the paradigm to, "We only need this much money, and it can be a job I enjoy,"'

Having a job can be beneficial even if you don't need the money, as it allows you to stay connected with your passions and stay busy.

Perhaps you're working a part-time job that supports your interests while still allowing you to save some money.

An outdoors store was where one of Espinosa's clients spent his part-time work, engaging in conversations about fishing with customers all day.

""He's thrilled about getting all the discounts," she says."

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