Finding work in retirement

• By Paul Keegan, Money Magazine contributing writer
• On 4:49 am EDT, Tuesday September 22, 2009

Tom Wogan loves working with his hands, especially building fishing rods and restoring World War II Army knives. So when he retired in June 2006 at age 60 from his $110,000-a-year job as a shift manager at the Florida City nuclear power plant near his home in Palmetto Bay, Fla., he looked forward to spending carefree days puttering around his garage working on his hobbies. With a retirement portfolio worth $1.1 million, Wogan thought he was all set.

Then the bottom fell out of the stock market. Wogan's cool million plummeted 36% in a matter of months; since then, as he's tapped savings to meet living expenses, his portfolio has dropped further and is now worth just $630,000. That's hardly enough to last Wogan and his wife, Pamela, 55, into ripe old age -- especially since her job as a graphic designer pays only $32,000 a year and the Wogans still pay a mortgage and aren't done with college tuition for three of their four children yet.

Tom found a consulting gig last year to supplement their income, but the position ended when the economy soured. So today, at age 63, he is searching for a full-time job for the first time in nearly 40 years. "I don't usually worry about much, but over the past few months, I've had a very anxious feeling," he says.

About 9.5 million Americans understand what Wogan is going through: That's the estimated number of retirees who are considering at least a partial return to the workforce because of the economic downturn, according to a recent study by Charles Schwab.

In fact, the Employee Benefit Research Institute reports, only 20% of retirees now feel very confident they have enough money to live comfortably throughout their retirement, down from 41% in 2007.

But while unretirement may seem like the solution, landing a job isn't easy for anyone these days, let alone older workers. Only about a quarter of employees 55 and older who were laid off during the past year have found jobs vs. 71% of those 25 to 34, CareerBuilder.com reports. Add a gap on your résumé to outdated skills and business contacts, and the challenge looks daunting indeed.

Daunting, yes, but definitely doable, experts say -- if you know how to leverage your best assets: decades of experience, maturity, and a lifetime of contacts. The trick is making all those years in the business be seen as an advantage rather than a liability.

"It won't be a piece of cake," says Joan Cirillo of Operation A.B.L.E., a job-training organization for older workers in Boston. "It requires getting savvy about effective job-search techniques, networking, and assessing the skills you bring to the table. But it can be done -- we see older workers finding work all the time."

The following strategies will help ensure that you're one of the successful ones.

Look beyond your field

Competing against younger job hunters who don't have a big hole in their résumé often requires repositioning yourself in the market. Your previous title and accomplishments matter less than the specific abilities and knowledge you can offer an employer.

The goal of repositioning is to broaden the types of jobs you can go after and the companies and industries that might be interested in you. The wider you cast your net, the likelier you are to land something worthwhile.

Start with the following exercise, suggests Martin Kartin, who runs a boutique executive search firm in New York City. Define your ideal job without naming an industry, a company, or even a job title -- just write down the tasks you would perform given the expertise you have developed over the years.

So instead of saying you want to be an "advertising executive," for example, make a list of what you would actually do in that job: Think creatively, write well, organize meetings, present ideas to a group, manage staff, oversee budgets, meet tight deadlines, and so forth. You'll probably find that you bring more to the table for a greater variety of positions than you had imagined.

Next, make a list of industries, companies, and jobs where you could use those talents. Don't confine yourself to online searches, since employers posting on popular jobs boards are often swamped with applicants. Also check with your state labor department for lists of industries that show hiring growth and stay away from the ones that are shedding jobs.

For example, the health-care industry is still growing robustly. Thus a finance executive who spent most of his career in the now-struggling retail industry might find ways to apply what he knows to a hospital or medical practice. A designer from the moribund auto industry might fit in well at a sporting goods company. Nonprofits, another growth area, are often welcoming to executives with corporate experience. (You may find ideas and leads about nonprofit opportunities at bridgestar.org.)

Once you've assembled a list of possibilities, do some research on the companies or organizations that you're most interested in. Then use that information to think through how your background and expertise would fit with their operations. When you look for work outside your field, the onus is on you to connect the dots for prospective employers.

"Sometimes it can take a lot of prodding from me to get candidates to explain how they could get hired in another industry, but I shouldn't have to," says Kartin. "They should already be thinking about how to transfer their skills."

Get up to industry speed

Let's face it, you've probably gotten a little rusty during your time away from the world of work. No shame in that, of course. What would retirement be if it didn't include lots of well-deserved relaxation?

But employers don't care about how much your golf game has improved over the past few years, and they have neither the time nor the money to ease you back onto the fast track. They need employees who are up and running now. If that doesn't describe you, they'll simply move on to the next candidate.

At a minimum, you'll need to be familiar with the latest version of the standard software used in the industries you're interested in, as well as basic office programs such as Outlook, Excel, Access, and PowerPoint.

Not there yet? Look for nonprofits in your area that provide free training or community colleges that offer low-cost courses. "Most jobs today require not just computer literacy, but real fluency," says Cirillo. Plus, being technologically proficient will help you beat one common rap against older workers: Some 44% of employers believe older employees are averse to technology vs. 13% who say the same about younger workers, according to a study by the Sloan Center on Aging and Work at Boston College.

You also need to get your head back into the professional game. For each industry you're targeting, brush up on the jargon, find out who the major players are, and get familiar with the challenges that businesses in the sector are facing and the latest developments.

The best way to do that is to attend industry events, where you can listen to panel discussions, network, and come up with ideas for adding value to whatever companies you'll be approaching. Try inviting some of the people you meet in the industry out to lunch to ask for advice. Be sure to share your insights as well, along with any interesting tidbits you've picked up at conferences that they might find useful. This will make your contacts more favorably disposed to give you job leads -- or at least recommend others to talk to.

Show forward thinking

One of the biggest stereotypes about retirees is that they are set in their ways -- and sometimes it's true, says Kartin. "Many retirees don't want to compete with younger people based on their skill," he says. "They can have an almost dogged intransigence: 'I know how to do it; I've done it for 30 years,' and they expect to get the job based on that alone."

Certainly Tom Wogan feels that his experience should be viewed as a real asset. Wogan took early retirement after 36 years at Florida Power & Light Co. because, as he puts it, new management came in with "different ideas about the way things should be done." When he realized last year that he needed to work again, he spent months perusing Internet job sites, occasionally sending out rsums that underscored his many years in the industry and becoming increasingly frustrated by the lack of response.

What's wrong with his approach? For one thing, job searches these days need to be a lot more proactive. Simply looking through the classifieds probably isn't enough to get you hired. Plus, presenting yourself as a 60-year-old with 35 years of experience can make you seem as if you belong to history rather than the urgent present and promising future, career experts say. Instead, find ways to show you have successfully reinvented yourself several times over the course of your career; the implicit message is that you've done it successfully before, and you'll do it again.

"Retirees should position themselves as people who have already had two or three careers and are now eager to start on their fourth," says Kartin.

One way to do that is on your résumé: Highlight each job move as a desire for change and new challenges and show how you mastered new techniques -- and make sure the skills you emphasize are ones your research has shown are in big demand at the company in question.

If, like Wogan, you spent most or all of your career with the same employer, stress each new position or set of responsibilities you took on. In cover letters and interviews, talk about your previous experience, of course, but devote equal energy to your eagerness to take on fresh challenges.

Demonstrate your value

As you have heard ad nauseam, finding a job is all about networking, but that is a much misused and misunderstood word. Most people think networking involves calling your friends and former colleagues and asking whether they've heard of any jobs. In fact, it's actually about making yourself valuable by creating opportunities for yourself and others.

Take Dan Merchant, 63. In 2006 he retired from his job as chief marketing officer for an investment firm, where he earned a base salary of $300,000 and had set aside $2.5 million for retirement. But the following year a combination of stock market losses and some free spending (principally on his daughter's wedding, which cost $150,000) made him realize that he needed to return to work.

Merchant began the search indirectly by putting himself back in professional circulation in a way that demonstrated his value. He traveled to New York City from his home in Westmont, Pa., to lunch at the Yale Club with a friend who needed career advice. There, he ran into a former colleague who asked him for some advice about branding. After learning more about what the executive needed, he approached a strategic marketing consulting firm he'd done business with before and offered to work for free to help the company snag the client.

The plan went so well that the firm signed him up as a paid consultant; by January it had hired him full-time. The $120,000 annual salary is lower than he was used to -- understand up-front that you may have to accept a lower paycheck than you earned at the peak of your career -- but Merchant says it's plenty now that he's living in Scottsdale and his daughter is grown up. Plus, he gets full benefits, including a matching 401(k) that will help him rebuild his retirement portfolio, which has sunk to $1 million as a result of the market downturn and his divorce settlement (he and his wife recently split up).

At no point in the process did Merchant ever ask anybody for anything. Rather he made himself valuable -- to his lunch friend, his former colleague, and to the consulting firm that eventually hired him. "Most people make the mistake of trying to sell themselves based on what they've already done rather than what they can do for the company," says Kar tin. "Offer yourself as a solution to whatever issues the company is dealing with."

So don't wait to hear about a job opening. Target a company you want to work for, research its pressing needs, and develop proposals about ways you can help. Even if the company doesn't go for your ideas or offer you a job, you've succeeded in demonstrating you understand the business and could contribute when an opening develops. Your contacts at the firm may even recommend you for other jobs they hear about.

Get a foot in the door

Merchant's story also illustrates the value of putting yourself in a position to let prospective employers see you in action by taking on a freelance project or consulting gig, agreeing to work part-time or for a set period, or even volunteering for a spell.

"It's a great way to show people what you can do," says Trisha Griffin-Carty, a career coach in Dedham, Mass. "You can always renegotiate later." Once you're actually working, you get to drop the "retiree" label and become a marketable person proving what an asset you can be to the company.

In fact, you may find that temporary or part-time work provides enough income to stanch the flow of red ink, since you probably no longer have children living with you to support and a big mortgage to pay. You may also be drawing Social Security or be able to tap retirement funds to close the gap between your expenses and income. That gives you the flexibility to accept a position that isn't full-time but could lead to something bigger -- a job younger workers may have to pass up.

Some companies are more open than others to unconventional arrangements. Try looking at websites that specialize in firms that hire older workers. Check out workforce50.com, YourEncore.com, and simplyhired.com (which has a filtering option for "age 50+ friendly companies"). AARP (aarp.org) also publishes an annual list of companies with excellent records of hiring older workers.

Create your opportunity

If you continue to strike out in the job search, another option is to go into business for yourself. As appealing as the idea may be, however, you'll be taking a big risk sinking your dwindling retirement savings into an untested venture. So you need to do some serious legwork first to determine how viable your idea is and how soon the business could actually generate the income you need.

Try this exercise, devised by Kate Wendleton, president of the outplacement group the Five O'Clock Club and author of "Your Great Business Idea: The Truth About Making It Happen." At the top of a sheet of paper, write the business concept in a sentence or two, being as specific as possible. Then use the top third of the page to describe the market for your product or service: who will buy it, how you will market it, what price you will charge, and who your competitors will be. In the middle, describe how your offering will differ from the competition's. At the bottom, analyze the profit potential -- what you can realistically expect in revenue and expenses, and how many clients you'll need to make your operation work.

The results help you evaluate several options quickly and expose flaws. Pick the one or two ideas that seem most viable and begin researching answers to questions that came up as you tried to put the idea down on paper. To protect your nest egg, stay away from businesses that involve high fixed costs, such as maintaining a large inventory or leasing equipment. Instead, lean toward service operations that require low overhead -- say, running a small tax-prep firm or a catering outfit.

Then, once you've fleshed out the details, get some expert advice. Score (score.org), a nonprofit association affiliated with the Small Business Administration, offers free counseling for entrepreneurs at every stage of the process, from preparing a business plan to raising capital and managing operations. You can also check out "The Would-Be Entrepreneur's Handbook."

Another intriguing option for retirees is buying a franchise or other established business. That's what Carl and Shelia Baynes did recently. Shelia, 57, retired almost two years ago from her $100,000-a-year job running a nonprofit emergency family-services organization in Newark, and Carl, 59, took an early-retirement package from his $150,000 position selling software for IBM last November.

As their $560,000 in retirement savings dwindled to less than half that amount, courtesy of the market slide, Carl quickly realized he needed to go back to work and reached out for job leads to former colleagues, bosses, and friends. But he became discouraged by how many other qualified unemployed professionals of his age he encountered.

So Carl went to a seminar on franchising and was hooked. After exploring several options, the couple plunked down $70,000 of their retirement savings into a Mr. Handyman home-repair franchise in Sarasota, where they had long planned to move from Montclair, N.J., after their two children left home. The couple anticipate they'll need to invest another $50,000 of their retirement funds into the business over the next year.

The Bayneses have already unwittingly made a potentially damaging mistake, says Richard Solomon, a Houston franchise attorney. Solomon recommends that fledgling entrepreneurs buy an operation only if it's already running profitably in a particular location, rather than starting from scratch.

"Most franchisers require you to pay such high fees that it's hard to compete against similar businesses in the area," says Solomon. The Bayneses may lose business to local home-repair companies that can offer cheaper rates because they don't have to pay the Mr. Handyman franchising fees.

Before buying a franchise, Solomon suggests, hire an attorney who can help you analyze the terms of the deal and who may also be able to advise you about whether you can really turn a profit. That's especially important, he says, if you plan to invest a good chunk of your retirement savings in the business. (Ask your state bar association for a list of local lawyers who specialize in franchise law.)

Also be sure to talk with other franchise owners to get their take on the business. A smart approach: Say you may be interested in buying their franchise, and ask if they'd be willing to show documentation of expenses and profits (for instance, by showing you income and sales tax returns for the past couple of years). That way, you're sure to be getting the straight story. Alternatively, Solomon suggests, you can contact a business broker (find one at ibba.org) who can help you find businesses for sale that are already operating at a profit.

The Bayneses say they have done their research and have seen proof that Mr. Handyman franchises bring in more than $1 million in gross revenue in major cities. Carl thinks their smaller operation could eventually reach $300,000 to $400,000 in revenue. "I'm not looking for a home run," Carl says. "If we can earn $80,000 to $100,000 in profit, we'll be fine."

The Bayneses do have one quality that is crucial for the success of any post-retirement career, entrepreneurial or otherwise: a healthy sense of adventure. They're excited about living near the beach and working together for the first time in 34 years of marriage. Carl will be the owner, Shelia the first employee, and they are setting up shop in a rented office.

"Hopefully, he'll pay me well," Shelia says, talking on a cellphone during the drive to their new home in Sarasota. From the driver's seat, Carl already sounds comfortable in his new role as the boss. With a booming laugh, he shouts, "Minimum wage!"

Buzz up!