Second Acts: Reinvention, Encore Careers and Work on Your Own Terms

Introduction

There is an old picture of retirement that many of us still carry around: a gold watch, a leaving party, and then a long, gentle glide away from usefulness. Early retirement is sometimes imagined as the same picture, only started sooner. Yet when you listen to people who have actually left their careers early, a very different story emerges. Many of them are working. They are writing books, teaching teenagers, running small businesses, building community spaces, advising neighbours, volunteering, making music. What has changed is not whether they work but why, how much and on whose terms.

This chapter is about that second act. It explores the research on ‘bridge employment’, the paid work people do after leaving a career job; on ‘encore careers’, the term popularised by Marc Freedman for later-life work that combines purpose, passion and often a pay packet; on ‘unretirement’, the surprisingly common return to work after retiring; and on the growing number of people who start businesses in mid and later life. It then turns to the stories of people who stepped off the career ladder well before state pension age and built something new.

Thoreau left Walden Pond after two years because he felt he had ‘several more lives to live’ (Thoreau, 1854, ‘Conclusion’). That is the spirit of this chapter. Financial independence does not have to mean the end of a working life. For many people it is the moment when working life finally becomes their own.

What the research tells us

Retirement is a process, not a single event

Economists and gerontologists increasingly treat retirement as a series of transitions rather than a clean break. The economist Nicole Maestas, using the American Health and Retirement Study, found that nearly half of retirees follow a ‘nontraditional’ path involving partial retirement or unretirement, and that at least 26% of retirees later return to work. Her most interesting finding concerned why. It is tempting to assume that people who go back to work have run out of money or planned badly. Maestas found instead that unretirement was anticipated before retirement for the vast majority of those who returned, and was not the result of financial shocks, poor planning or low wealth (Maestas, 2010). In other words, many people plan from the outset to have a second working chapter.

The pattern is similar in Britain. Loretta Platts and colleagues followed 2,046 Britons aged 50 to 69 through the British Household Panel Survey and its successor, Understanding Society. Around a quarter of those who reported being retired later experienced a retirement reversal, and about half of these reversals happened within the first five years of retirement (Platts et al., 2019). The economics journalist Chris Farrell gathered stories of this trend in his book Unretirement (Farrell, 2014), arguing that many people are extending their working lives through new careers, entrepreneurial ventures and volunteer service.

Bridge employment and wellbeing

Does working after leaving a career job actually do people good? A number of longitudinal studies suggest it can, especially when the work is chosen.

Yujie Zhan, Mo Wang and colleagues examined 12,189 retirees from the first four waves of the Health and Retirement Study. Compared with full retirement, doing bridge work, whether in the same field as one’s career or in a different one, was associated with fewer major diseases and fewer functional limitations. Bridge work in one’s career field was also associated with better mental health (Zhan et al., 2009). As with most observational research, healthier people may simply be more likely to keep working, and the authors themselves discuss the study’s limitations. But the association is consistent with the idea that engaging, structured activity supports health.

The reasons for working matter a great deal. In a study of 1,248 Dutch retirees, Ellen Dingemans and Kène Henkens found that people who took bridge jobs for financial reasons saw their life satisfaction fall compared with those who worked after retirement for intrinsic reasons. Retirees who wanted a bridge job but could not find one reported lower life satisfaction. And while involuntary retirement was harmful to life satisfaction, taking up a bridge job helped to cushion that blow (Dingemans and Henkens, 2014). This is exactly the pattern that self-determination theory, discussed in Chapter 3, would predict: work that is freely chosen and personally meaningful tends to support wellbeing, while work done under pressure does not (Ryan and Deci, 2000).

Encore careers: purpose, passion and a pay packet

Marc Freedman, founder of the organisation Encore.org (renamed CoGenerate in 2022), has spent decades arguing that the years after a main career can be a time for ‘work that matters’. His book Encore: finding work that matters in the second half of life (2007) told the stories of people who moved in midlife and later into roles in education, health, the environment and social services, and helped to popularise the term ‘encore career’ (Freedman, 2007; CoGenerate, 2022).

A 2014 survey commissioned by Encore.org from the research firm Penn Schoen Berland estimated that more than 4.5 million Americans aged 50 to 70 were already working in encore careers aimed at social impact, and that another 21 million were preparing to join them. Among those already in encores, 86% said their encore role was as enjoyable as or more enjoyable than their previous career, 82% said it expressed ‘who I am as a person’ as much as or more than their prior work, and 80% said it gave them as much or more opportunity to contribute to society. On average they worked about 21 hours a week, seven in ten were doing something new compared with their main work at 45, and nearly a third were self-employed. Tellingly for readers of this book, the transition often came early: 44% of those in encore careers had moved into them between the ages of 45 and 54 (Encore.org, 2014). These figures come from an advocacy organisation and rely on self-report, so they should be treated as indicative rather than definitive. Still, they paint a vivid picture of later-life work chosen for meaning.

Purpose is not a luxury. In the long-running Midlife in the United States (MIDUS) study, Patrick Hill and Nicholas Turiano found that people with a greater sense of purpose in life were more likely to be alive 14 years later, even after controlling for other markers of wellbeing, and that this benefit did not depend on age or on whether people had retired (Hill and Turiano, 2014). An encore career is one of many ways to keep that sense of purpose alive once a first career ends.

Starting something of your own

A particularly striking form of reinvention is entrepreneurship. The popular image of the founder is a twenty-something in a hoodie, but the evidence tells a different story. Using US administrative data on firms, workers and owners, Pierre Azoulay, Benjamin Jones, Daniel Kim and Javier Miranda found that successful entrepreneurs tend to be middle-aged. The mean age at founding for the fastest-growing one-in-a-thousand new ventures was 45, and prior experience in the same industry strongly predicted success (Azoulay et al., 2020). Experience, it turns out, is an asset.

For many people, though, the point of starting something late in a career is not rapid growth but a better life. Teemu Kautonen, Ewald Kibler and Maria Minniti used data from the English Longitudinal Study of Ageing to examine what happens when people in late career move from employment into running their own business. Starting a business was associated with an increase in quality of life, but a decrease in income (Kautonen, Kibler and Minniti, 2017). For a financially independent person, that trade-off may be exactly the right one: money matters less, while autonomy, challenge and meaning matter more.

Self-employment among older people has also grown in the UK. The Office for National Statistics reported that the number of self-employed people aged 65 and over rose from 159,000 to 469,000 between 2001 and 2016 (Office for National Statistics, 2018). Not all of this represents joyful reinvention, and the ONS notes a sharp rise during the economic downturn, but it shows that working for oneself in later life has become a mainstream path rather than an eccentric one.

Why second acts can feel so different

Taken together, this research points to a simple idea. Work itself is not the problem. Work done without choice, for money one does not need, on someone else’s schedule, is what many early retirees are escaping. When financial independence removes the need to earn, what often remains is a desire to be competent, to be connected and to be useful, the very needs at the heart of self-determination theory (Ryan and Deci, 2000). A second act allows people to meet those needs on their own terms: fewer hours, chosen projects, familiar skills in new settings, or entirely new skills learned for the joy of it.

Lives enriched: real stories

Lucy Kellaway — from Financial Times columnist to classroom teacher at 58

For 31 years, Lucy Kellaway worked at the Financial Times as a reporter and columnist. In July 2017, shortly after her 58th birthday and several years before state pension age, she left what she called ‘the world’s nicest job’ to train as a maths teacher in an inner-London school. At the same time she co-founded Now Teach, now a registered charity, to help other experienced professionals change career into teaching (Kellaway, n.d.).

Her reasons were not about money or escape. She wrote that in her old job she had autonomy, great colleagues and the freedom to write about whatever interested her, yet ‘it bothered me more and more that I was no longer getting better at my job’. Hoping to live for many more decades, she felt it ‘seemed mad to spend my whole life doing one thing’ (Kellaway, n.d.).

Two and a half years on, she said she had never regretted the change, ‘not even during that first year’. She discovered that she received as much energy from her pupils as she gave, developed a new love of economics, which she ended up teaching, and relished ‘the feeling of getting constantly better’ and friendships with colleagues half her age. The hardest parts, she admitted, were having to follow rules and ‘having no autonomy over my time’, a problem eased once she moved to part-time teaching (Kellaway, n.d.). In a 2018 interview with Tes, she said that full-time teaching in her first year had been ‘unendurably hard work’, and that moving to three days a week and switching to business studies and economics, where she felt ‘absolutely in my element’, made it manageable (Hazell, 2018).

Kellaway’s story is a model of an encore career in the fullest sense: a deliberate move away from a successful first career towards learning, service and growth, with enough flexibility to make it sustainable.

Sam Dogen — from investment banker to full-time writer at 34

Sam Dogen spent 13 years in investment banking, first in New York and later in San Francisco. In 2009, in the middle of the financial crisis, he started a personal finance blog, Financial Samurai, partly to make sense of losing a large share of his net worth in a matter of months. The downturn, he wrote, made him realise he no longer wanted to work in finance: he had ‘lost the hunger to make lots of money and climb the corporate ladder’ and instead found himself ‘addicted to writing’ before work, at lunch and after work (Dogen, 2021).

In 2012, at the age of 34, he negotiated a severance package that he says covered around five years of living expenses, and left banking to build Financial Samurai full time. His wife left her finance job at 35 in 2015. He describes more than 16 years of writing on the site, which he says reaches about a million organic visitors a month, and he has written an e-book on negotiating a severance package. He lives in San Francisco with his wife and their two children (Dogen, 2021).

Dogen’s second act illustrates the entrepreneurial path the research describes. He took skills from his first career, a knowledge of finance and markets, and redeployed them in a new form of work he had already discovered he loved while still employed.

Chris Mamula — from physical therapist to writer, author, volunteer and adviser

Chris Mamula documented his path to financial independence on the blog Eat the Financial Elephant before leaving his career as a physical therapist in December 2017 at the age of 41. Shortly afterwards he became a partner on the long-running blog Can I Retire Yet? (Can I Retire Yet?, n.d.), and he, his wife Kim and their young daughter moved to Utah, where mountain life became central to their days (Mamula, 2020).

In an unusually candid post after three years of early retirement, he described the good year that followed his first: he and Kim each skied more than 50 days in their first Utah winter, he found fulfilment volunteering with a local adaptive ski programme, they finished remodelling their house, and he released his book, Choose FI: your blueprint to financial independence (Mamula, 2020). He has since also worked with individual clients at Abundo Wealth, an advice-only financial planning firm (Mamula, 2020).

He was equally honest about the hard parts. Financial independence, he wrote, ‘didn’t fix us. It almost broke us’: reaching their financial goals removed a shared mission and eliminated the excuses of busyness, and he and Kim eventually sought help to rebuild their marriage. His strongest advice was not to wait for retirement to become the person you want to be, because priorities ‘won’t magically change when you retire’ (Mamula, 2020). His second act, in other words, was built as much on inner work as on outer achievement.

Pete Adeney (Mr. Money Mustache) — the early retiree who opened a business on Main Street

Pete Adeney retired at around 30 and became widely known as the author of the Mr. Money Mustache blog. In 2017, more than a decade into retirement, he and his wife and another couple bought a run-down commercial building in downtown Longmont, Colorado, which he restored largely with his own labour. He explained that he wanted to be more involved in his local community, to host classes and events and to make Main Street ‘a more joyful place’, and that he preferred this to opportunities that would mean more time on aeroplanes or at the computer and less time with his son (Adeney, 2017).

His half of the building became ‘MMM HQ’, a membership-based coworking and gathering space. A year after it opened, he reported that it had around 50 members and hosted barbecues, potlucks, meet-ups, charity events and a pop-up business school. ‘As I always say,’ he wrote, ‘early retirement is great, but it doesn’t mean you’re allowed to stop working’. He described walking or cycling down to the building most mornings, opening up, making coffee and doing some weight training before the day’s conversations and tasks began, and emphasised that the best part was that it was ‘completely optional work’ which the members could run without him while he was away (Adeney, 2018). He also acknowledged its limits, including a membership skewed towards well-off men in their thirties and forties, which he said he was trying to change (Adeney, 2018).

Jake Desyllas — from founder to author, podcaster and perpetual traveller

Jake Desyllas, who was born in the United Kingdom and holds a doctorate, founded Intelligent Space in 2000, an award-winning consultancy specialising in pedestrian movement simulation and analysis. In 2010 he sold the business and retired early at the age of 38 (Desyllas, n.d.; Goodreads, n.d.). Rather than stop, he reinvented himself as a writer and broadcaster on entrepreneurship, financial independence and freedom: he hosts The Voluntary Life podcast and has written books including Becoming an Entrepreneur and Job Free (Goodreads, n.d.). His public profile describes him as a perpetual traveller, a minimalist and a marathon inline skater (Goodreads, n.d.).

Desyllas’s second act shows how early retirement can turn a successful first career into the raw material for a second one. Having experienced both entrepreneurship and financial independence, he has spent his later years helping others think through the same choices, including in conversations with other early retirees such as Justin of Root of Good, whose story appears in Chapter 3 (Desyllas, 2015).

A balanced view

The idea of a joyful second act is inspiring, but the evidence also contains clear warnings.

First, reinvention is easier for the advantaged. Platts and colleagues found that unretirement in the UK was more common among men, people with more education, people in better health and those whose partners were working, and that it was not more common among those in greater financial need. They conclude that returning to work may be a strategy used mostly by people who are already advantaged, with the potential to widen inequalities in later life (Platts et al., 2019). Most of the people in this chapter’s stories were high-earning professionals, and several are candid that privilege and luck played a part.

Second, not everyone who wants a second act gets one. Dingemans and Henkens found that retirees who wanted bridge work but could not find it experienced lower life satisfaction (Dingemans and Henkens, 2014). Age discrimination, caring responsibilities and health problems can all stand in the way, and planning for a second act should include a plan B.

Third, motive matters. Work taken on for financial reasons was associated with falling life satisfaction in the Dutch study (Dingemans and Henkens, 2014). An ‘encore’ driven by worry about money is a very different experience from one driven by curiosity or purpose. This is one reason why sound financial planning, discussed elsewhere in this book, is the foundation that makes a free choice possible.

Fourth, new ventures usually pay less. Kautonen and colleagues found that late-career entrepreneurship improved quality of life but reduced income (Kautonen, Kibler and Minniti, 2017). And the finding that the most successful high-growth founders tend to be middle-aged (Azoulay et al., 2020) says nothing about the odds facing a typical small business. Starting something new is best treated as a source of meaning, with any income a bonus.

Fifth, the transition can be hard, even when it is right. Lucy Kellaway called full-time teaching in her first year ‘unendurably hard work’ (Hazell, 2018). Chris Mamula found that early retirement exposed strains in his marriage that busyness had hidden (Mamula, 2020). A second act can be deeply rewarding and still demand humility, patience and support.

Finally, much of the evidence on encore careers comes from surveys by organisations that promote them (Encore.org, 2014), and most research on bridge employment follows people who retired in their late fifties and sixties rather than their thirties or forties. We still know relatively little, from rigorous studies, about how very early retirees fare when they start again.

Putting it into practice

• Treat retirement as a series of chapters. Following Maestas’s finding that many returns to work are planned in advance (Maestas, 2010), sketch not just your retirement date but what the first, second and third phases might look like.
• Start the second act as a side project. Sam Dogen and Chris Mamula both began writing while still employed (Dogen, 2021; Mamula, 2020). Test your interest before you need it to carry your sense of purpose.
• Audit your transferable strengths. List the skills, knowledge and relationships from your career that you would still enjoy using. Industry experience is a real advantage for later-life founders (Azoulay et al., 2020).
• Choose work for intrinsic reasons. Before taking on any post-career role, ask whether you would still want it if it paid nothing. If the honest answer is no, reconsider (Dingemans and Henkens, 2014).
• Protect your autonomy. Negotiate part-time hours, project-based work or flexible arrangements from the start. Kellaway’s experience shows how much difference three days a week can make (Hazell, 2018).
• Look for purpose and people. Encore careers in education, health, the environment and community work consistently score highly for meaning (Encore.org, 2014). Programmes such as Now Teach in the UK exist specifically to help experienced professionals switch careers.
• Build community into what you create. Pete Adeney’s coworking space shows how a second act can be designed around friendship and local life rather than profit alone (Adeney, 2018).
• Budget for lower earnings. Assume any new venture will earn less than your old career, and plan your finances so that it does not have to earn at all (Kautonen, Kibler and Minniti, 2017).
• Have a plan B for the inner work. Expect identity, relationship and motivation questions to surface once the old structures fall away, and be willing to seek help, as Chris Mamula did (Mamula, 2020).

Questions for reflection

1. If money were no longer a consideration, what work, paid or unpaid, would you still want to do?
2. What have you been getting better at recently? Where in your life do you still feel you are growing?
3. Which skills from your current career would you most enjoy using in a completely different setting?
4. Whom would you most like your second act to serve: young people, older people, your neighbourhood, your profession, the planet?
5. How much structure do you want in a second act? How many days a week, and on whose schedule?
6. What would a small, low-risk experiment towards your second act look like in the next three months?
7. What might financial independence expose in your life that busyness currently hides, and how will you meet it?

References