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The 1 thing your company should add to its retirement benefits


You have the human resources paperwork down, but are you really helping your employees transition to retirement?

In a recent study of more than 100 U.S. workers, MIT Sloan professor emerita Lotte Bailyn and her research colleagues found a variety of ways pre- and early-retirement individuals manage their transition out of the workforce. But a common thread among respondents is that companies lack mutually beneficial resources for handling retirement.

“Over and over again people tell us, ‘As soon as I said I’m going to retire, I’m a nobody,’” Bailyn said. She said organizations are not making the retirement process work for people who have a lot of experience and institutional knowledge, but also want to slow down as they near retirement.

The interviews were conducted by Bailyn and her colleagues during a three-year period. The study is based at Harvard Business School under professor of business administration Teresa Amabile.

“We undertook this research to go beyond health and wealth, into the organizational, social, and psychological forces that can affect people’s retirement experiences,” Amabile said.

The team of researchers include Kathy Kram, emerita professor of organizational behavior at Boston University; Marcy Crary, emerita professor of management at Bentley University; Tim Hall, emeritus professor of management at Boston University’s Questrom School of Business; and Jeff Steiner, a PhD student at Harvard Business School.

The researchers interviewed 120 people, most of whom were people who had retired or were 55 or older and in “pre-retirement.” Twelve workers in the process of retiring were interviewed up to 10 times by the researchers, as they made decisions and adjustments in their transitions into retirement.

Everyone interviewed said they had some contact with a human resources representative for clarifying details around social security or Medicare, but that didn’t resolve other issues around retirement, Bailyn said.

“A lot of them didn’t think they had any human contact,” Bailyn said, “and so felt there really wasn’t an occasion to sit down with someone and ask ‘Here’s what I’d like to do, how can you help?’ and discuss some of these things.”

Bailyn said companies struggle to provide retirement resources in part because of a lack of creativity.

A business might be happy for its bottom line when an older, higher-paid employee retires, but it isn’t taking advantage of the institutional knowledge while they’ve got it. Perhaps management changes, Bailyn said, and new leadership doesn’t understand the value of their longtime employees’ experiences.

So what can companies do to help themselves and retiring employees? Bailyn mentioned two strategies. These are just a start.


This option allowed a retiring employee to work less while receiving a percentage of their pay, plus benefits. At the end of the phase-down — which can range from months to a handful of years  — the person retires.

“The people who took that found it extremely beneficial because they had some extra time where they were almost forced to think about what they’re going to do,” Bailyn said. And a phase-down can help with transitioning roles and responsibilities of a particular position to the successor.

Contracted rehiring 

Regardless of a company’s approach, it’s important to let people find out for themselves what the best way to transition to retirement is, Hall said.

“I think anything that helps people reconnect with themselves and things that gave them joy, or give them joy now, I think that’d be really helpful,” Hall said. “But to me it’s surprising how little employing organizations are doing to help them do that — even though at the same time they’re interested in maybe helping people move on and opening up opportunities for younger people, they’re not. I think there’s a great opportunity cost they’re suffering by not doing that.”

Life structure and identity bridging

The study’s findings are still in a preliminary stage, however, the researchers were able report on two emerging themes: life structure and identity bridging. “One of the metaphors we have is when you’re in the pre-retirement life structure, you’re basically like a tenant in your structure that you’ve created,” Crary said. “You’re living within it; assuming there’s a routine, you’re settled. When you move you retire and you’re taking out this huge chunk of work and all the stuff that goes along with it. There’s this time of uncertainty and you’ve got to figure out what’s next. You were a tenant in one structure, now you’ve got to become an architect — you have to be more of an active chooser.” Dismantling and rebuilding the life structure are part of pre- and early retirement. Identity bridging is what helps people “retain their sense of self during this enormous transition,” the researchers wrote in preliminary findings. “The first thing is to ask yourself what you want to bridge,” Bailyn said. “What is it about your work that you’d like to take with you when you retire? And what would you like to leave behind? You could also ask the same questions about your family or community or avocations and hobbies.” The researchers saw seven examples of identity bridging emerge. The examples include:

  • enhancing a pre-transition identity through greater engagement.

  • activating a latent identity.
  • retrospectively revising a pre-transition identity.
  • maintaining a life philosophy or stance toward life.
  • enacting a previous identity in a new way.
  • finding a new source for valued affirmation.
  • putting a material stake in the ground.

“Our study participants demonstrate how important relationships can be in supporting the hard psychological work of handling lots of uncertainty and also establishing new commitments with meaning and purpose,” Kram said.

The study’s preliminary results point to the need for more organizational resources for employees to help them transition from tenant to architect and find the right strategy for them to bridge that transformation.

“Organizations can do an important service by providing opportunities for employees nearing retirement to learn about identity bridging strategies and how to implement them,” Kram said. “The opportunity to learn and engage in shared reflection with one’s peers on these matters make it more likely that future retirees will experience retirement as a highly rewarding and generative time of life.”

Crary said a lot of the people the researchers talked to said they were glad, or wished they had organizational resources as they were thinking about retirement.

“This all points to as humans we need spaces to go kind of meta on our lives, step out of the fray, and say ‘Who am I? Where do I want to go?,’” Crary said. “It’s that kind of facilitation at this life transition where providing those resources is very helpful.”

For more info Meredith Somers News Writer (617) 715-4216