2 Reasons To Think Twice Before Deciding on an Early Retirement

early retirement

New psychological research shows us how important employment is to life satisfaction and why an early retirement isn’t always the best choice.

We’ve all experienced episodes in our professional lives when it feels like nothing is going our way and that it may be time to throw in the towel. While having these feelings is normal, it can be counterproductive to act on them. Retirement or work hiatus decisions made out of frustration or exhaustion rarely end well.

Instead, when we are feeling like it may be time to call it quits, it’s better to engage in glass-half-full reasoning, reminding ourselves of the many positive aspects of our current career situation. And, when even that seems hard, we can look to scientific research for inspiration. Here are two insights from recent studies in psychology that can motivate us to keep our professional wheels in motion.

1. The link between employment and happiness is extraordinarily strong.

A large body of research suggests that having a strong “sense of purpose” is vital to our psychological well-being. It’s what gets us out of bed in the morning and gives us the energy to overcome life’s challenges.

One of the ways we derive our sense of purpose is from our jobs — even from jobs that may not fit into the category of dream jobs.

It should therefore come as no surprise that unemployed people exhibit lower levels of happiness and higher levels of anxiety and depression than individuals with part-time or full-time jobs. In fact, according to data from this year’s World Happiness Report, the life satisfaction of employed people around the world was approximately 1.2 points higher on the 0 to 10 life satisfaction scale. To get a sense of just how impressive this difference is, it would be like comparing the average happiness levels of Americans to the levels found in citizens of economically disadvantaged countries such as Moldova, Ecuador, or Kyrgyzstan.

The strength of the connection between happiness and jobs doesn’t stop there. Another study conducted by Andrew Jebb of Purdue University analyzed data from over 1.7 million people worldwide to uncover the keys to happiness across the human lifespan. Interestingly, they found employment to be a stronger predictor of happiness than marriage (although married people were also happier on average than unmarried people).

The data also revealed at which age the happiness difference between employed and unemployed individuals was at its greatest. They found the difference to be smaller during younger and older ages and to peak during middle age.

And, the researchers found this effect to be surprisingly consistent in all areas of the world, suggesting the “will to work” is a universal human need. They write, “For all measures and regions, employed people had higher subjective well-being than unemployed people, with differences that usually peaked around age 50.”

2. Throwing in the towel is better in theory than in practice.

Data from retired individuals offers additional insight into the value of employment. For instance, psychologists at the University of California Davis gathered data on 1,222 Dutch adults, ages 51-81, who completed a series of personality tests between 2008 and 2016. Their goal was to assess if, and how, people’s personalities changed upon retirement.

To answer this question, the researchers tracked five dimensions of personality (openness to experiences, extraversion, emotional stability, conscientiousness, and agreeableness) for up to a 60-month period before and after retirement.

The researchers found that retirement was associated with some interesting changes in personality. Immediately after retirement, for instance, people tended to become more open and more agreeable. The increases, however, were short-lived; participants’ scores on the openness and agreeableness dimensions of personality generally returned to pre-retirement levels within a year or two of retiring.

Furthermore, other research published in the American Economic Journal suggests that many retired Americans would return to work if given the opportunity. To come to this conclusion, the researchers surveyed 2,772 retired or semi-retired individuals, asking them to consider a hypothetical decision to return to work. Specifically, they were asked to decide whether they would be willing to return to work in a new employment situation that matched their most recent job in terms of occupation, annual earnings, and all other characteristics.

They found that approximately one-third of respondents who were not currently working chose to accept the hypothetical offer. Even when the researchers tinkered with the characteristics of the job offer (for instance, offering slightly lower pay or different hours), many respondents still indicated that they would return to the workforce.


Don’t jump into an early retirement before evaluating all of its pros and cons — and don’t be afraid to make a late-stage career move instead of retiring. Research tells us that employed or semi-employed people are happier than unemployed people, that age 50 may be the best time to have a job, and that the psychological benefits of freeing yourself from your professional life are generally short-lived.

Learn how to combat ageism in your interviews.

About the Author

Mark Travers, Ph.D., is an American psychologist with degrees from Cornell University and the University of Colorado Boulder. He can be reached at