Financial concerns drive retirees back to work: AARP

For a growing number of retirees, the exit from the workforce is proving temporary. Financial strain and economic uncertainty are pushing older Americans back into the job market, a new AARP survey found.

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The survey of nearly 2,400 adults age 50 and older, conducted in winter 2025, found that 7% of retirees had returned to work in the past six months. Nearly half of those respondents (48%) cited a need for supplemental income and concerns about inflation as the primary reasons for “unretiring.” Smaller shares said they went back to work out of boredom (15%) or to help others (14%).

Among wealth management clients, some advisors say that stimulation and socialization, not money, are the primary causes behind a retiree’s decision to return to work. But even for the reasonably wealthy, financial concerns can stack up, said Joon Um, a tax advisor and CFP at Secure Tax & Accounting in Beverly Hills, California.

“From what we experience working with clients, especially early retirees, many go back because of financial pressure or market anxiety, not boredom,” he said. “Inflation, health care and fear of running out of money are the big drivers.”

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When it’s too early to retire

For many retirees, the decision to return to work is influenced by when they decided to retire in the first place. Most retirees say they retired at the right time (68%), though nearly 3 in 10 (28%) say they left the workforce too early.

The AARP survey found that retirees pointed to a variety of reasons for leaving the workforce, including financial stability, health care access, caregiving responsibilities and layoffs.

Advisors say that delaying retirement, or returning to the workforce, can often have significant benefits for a client’s plan. But it’s important that advisors actually run the numbers to determine how much benefit someone would see from such a move, according to Um.

“When someone considers returning to work, we rerun the plan,” he said. “We look at cash flow, withdrawal rates and what a few extra years of income would actually change. Sometimes, part-time or consulting is enough to ease the pressure.”

Beyond boosting personal income, government officials such as Mehmet Oz, administrator for the Centers for Medicare and Medicaid Services, have suggested that older Americans should work later in life as a way to boost the economy.

“If we want to unlock the value of Americans, we have to keep them healthy,” Oz said during a recent forum on mental health. “But what does that translate to in money? … If we could get the average American — because they feel healthy, they’re vital, they’re strong, they have agency over their future — to start working a year earlier right out of high school, or work a year later, not retire, or work better during their lifetime because they’re healthy, it would generate about $3 trillion to the U.S. economy.”

AARP survey data shows that illness or disability is the second most common reason workers initially retire, cited by 21% of respondents. A larger share (50%) said reaching a sufficient savings balance, becoming eligible for Social Security or gaining access to a retirement plan was the primary driver of their decision.

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Returning to work is easier said than done

A small but notable share of retirees said they made the decision to retire after getting fired and being unable to find another job.

Data shows that older workers are largely pessimistic about the prospect of finding a new job, suggesting that the total share of retirees trying to return to the workforce is greater than the fraction who have successfully done so.

Roughly 2 in 3 respondents said that they would expect it to be very or somewhat difficult to find a job if they were looking right now. And that outlook is about more than the general job market, according to Rebecca Perron, senior research advisor at AARP Research. It’s about age itself.

“This widespread expectation of difficulty reflects a data truth: Historically, older workers stay unemployed longer after a job loss than do younger workers,” Perron wrote. “Older workers perceive age discrimination as the number one barrier to finding work.”

For older clients out of work, that fact can weigh heavily in the decision to retire or attempt a return to the workforce.

Still, for advisors like Um, the chief factor is not age, but “sustainability.”

“When deciding if it’s time to retire, it’s less about age and more about sustainability,” he said. “Can their savings realistically support their spending, and are they flexible if markets drop? Retirement doesn’t have to be all-or-nothing. The clients who do best treat it as a transition, not a hard stop.”