Over 50 and Freelancing to Fill the Gaps in Retirement Funds

In 2006, after 41 years of teaching business management, Charlotte Bishop decided to retire from her job at the Borough of Manhattan Community College. She was in her early 60s, had raised two sons as a single mother in the Bronx and wanted to spend more time with her grandchildren.

Just a few months later, however, she realized she had to get back to work. “Part of it was boredom,” she said. Another factor was money. “Financially, I wanted to prepare better in case I’m around for quite a few more years.”

She had also spotted a business opportunity: Many of her aging neighbors kept asking her to help them sort through their papers and belongings, and they were willing to pay for it.

“I’ve always been good at filing and organizing, and a lot of people, especially senior citizens, struggle with letting go of stuff,” she said. So she took some classes on entrepreneurship and drew up a plan for her own organizing consultancy, Life Files Professionals. Now 73, Ms. Bishop has a steady stream of clients and no interest in hanging up her hat. “I’ve always worked,” she said, “and I get a lot of fulfillment out of it.”

The stereotype of today’s freelancer is a young, scrappy urbanite hustling for gigs in a shared work space or coffee shop. And while it is true that millennials make up the largest chunk of the freelancer population in the United States, another demographic may soon catch up: their parents.

According to a study commissioned by the Freelancers Union and Upwork, 30 percent of Americans over the age of 55 did some freelance work in 2018. (Freelancing is loosely defined as any work that is independently contracted, from driving Uber to running a small business.) That number is expected to balloon as “the silver wave” of baby boomers approaches retirement age — a time when working 9-to-5 may no longer be feasible, but neither is not working at all.

“We see a lot of people over 55 starting to explore freelancing, either full or part time, as a source of extra income or as a way to transition into retirement when they can’t or don’t want to stop working entirely,” said Caitlin Pearce, the executive director of the Freelancers Union, the country’s largest advocacy group for independent workers. “You certainly never want to see someone working later in life than they want. But freelancing can be a good solution for people who are ready to scale back but haven’t saved enough to retire outright.”

For many American workers, the traditional picture of retirement — turn 65, enjoy a boozy send-off with colleagues and sail into your golden years supported by a healthy pension — isn’t realistic anymore.

“We really need to bust the myth that each of us works until a defined age and then have a defined retirement period,” said Lisa Marsh Ryerson, the president of the AARP Foundation, which helps seniors with financial planning. “The truth is, many 65-year-olds today still have mortgages. They’re facing extra medical expenses, stagnant wage growth and declining pension opportunities. For all those reasons, many of them need to continue to make money, but traditional employment may not be a viable or attractive option. And the sharing or gig economy is.”

Ms. Ryerson also pointed out that many people don’t retire by choice. Recent data collected by the Federal Reserve shows that about 25 percent of retirees were forced to stop working because of a lack of employment opportunities. In a new survey published Tuesday, conducted by the Harris Poll and commissioned by NerdWallet, 36 percent of retirees said it wasn’t their decision to retire as early as they did; 18 percent cited health reasons, while 9 percent said it was because they had lost their job and couldn’t find another.

“If you’re facing ageism in your industry, freelancing may be your best opportunity to explore new sources of income,” said Arielle O’Shea, NerdWallet’s retirement specialist. “Yes, it’s unfair to put the responsibility on the person who’s on the receiving end of discrimination, but if that person’s No. 1 goal is to continue making money, then self-employment can be helpful.”

And it’s not all doom and gloom. “We could view it from a negative standpoint of, ‘Oh gosh, I’ll be working forever,’” Ms. Ryerson said. “But I prefer to take a more optimistic stance: As we gain experience in life, and learn more about our skills and our preferences, we’ll have a lot more options to share those talents in new ways.”

Drumming up freelance work can be daunting, especially at first. Prof. Cal Halvorsen, who studies later-life self-employment and entrepreneurship at the Boston College School of Social Work, said he hoped to see more training and support programs for seniors who need them. “A lot of older workers are interested in becoming self-employed, but don’t feel prepared to do it,” he said. “Providing more infrastructure is one way to narrow that gap.”

There are resources for those who know where to look. In November 2016, the AARP Foundation started an initiative called Work for Yourself at 50+, which offers workshops and other services for budding senior freelancers. More than 15,000 seniors have participated in the program since it began.

For some, self-employment simply looks like a more autonomous version of their previous career. Steven Winn, 68, worked at The San Francisco Chronicle for 28 years before becoming a freelance writer in his late 50s, when he was offered a small buyout package to leave the newspaper. He has since made a living through a jigsaw puzzle of writing assignments, consulting and book authorship. “I certainly wasn’t ready to retire, financially, but I was ready for a change,” he said. “Now, I’m just going to keep doing this until somebody tells me to stop.”

Other later-life freelancers seize the opportunity for a whole new profession. For Peggy Hill, a New York City-based yoga instructor, the jump to entrepreneurship satisfied an itch that had been growing throughout her robust career in brand management for companies like Johnson & Johnson and General Electric. “After 30-something years in the corporate world, I finally reached the point when I was ready for that next chapter, to be my own boss,” she said. “I wanted more control over my life.”

Ms. Hill is quick to clarify that her teaching is not a hobby. “I have to be strategic,” she said. “I have business coaches and revenue goals. I assess competition, and that helps me make decisions on how I differentiate myself.”

In her case, being older than most other instructors can be an asset. “I figured I could target the over-40 crowd because once you hit that point, sometimes your body starts to shift, and I know the difference,” she said. Still, she declined to give her age for this article because she doesn’t want younger practitioners to write her off because of it, either. “Ageism is a double-edged sword,” she said.

No one knows that better than older workers who get pushed out of the job market. When Sheila Koppin, 57, of West Des Moines, lost her position as communications director of the Board of Regents for the State of Iowa four years ago, she panicked as the gap on her résumé grew wider and wider.

“I was actively looking for something full time but unable to find anything,” she said. She and her husband were planning to pay off their mortgage by the time they retired, but they couldn’t do so on just one income. So she took courses on entrepreneurship at the Iowa Center for Economic Success and started a business that provides writing and editing services. “It’s something I enjoy and am good at,” she said. “I’m hoping to grow and sustain it into my retirement years.”

Of course, maintaining a freelance career isn’t as easy as slapping together a personal website and naming your price. Self-employment taxes can be high (not to mention complicated) and the ebbs and flows of contract work can make it difficult, if not impossible, to save money. In other words, freelancing is not a cure-all, especially for the quarter of Americans who haven’t saved for retirement at all.

Health care is another consideration. Americans over 65 are eligible for Medicare, but anyone younger may struggle to afford their own health insurance plan. Professor Halvorsen said that married freelancers tended to be more financially stable, as they are more likely to have a financial cushion.

“For example, if you can obtain health care coverage through your spouse, it often means you can support yourself more easily, and put a little more money away,” he said. “But people who are single and over the age of 50, particularly women who have made less money throughout their careers, are more financially vulnerable and may have a harder time making the shift to self-employment.”

Still, those who have made the transition seem pretty happy about it. Surveys from the Freelancers Union show that older freelancers exhibit some of the highest satisfaction levels with their work. “A lot of people who freelance after retiring from the traditional work force find it enjoyable,” Ms. Pearce said. “They’re more likely to be using the career skills that they’ve built to do something they’re interested in, on their own terms.”