New Research: Income Gap During Career Transition Is Key Challenge for Millions of Americans, Ages 44 to 70, Who Want to Give Back in Encore Careers

31 Million Americans Want Encore Careers That Bolster Lifetime Financial Security and Make a Contribution to Their Communities
News Release - For Immediate Release -
For more information, contact:
Elysha Rom-Povolo, (415) 901-0111

SAN FRANCISCO – The financial challenges posed by midlife career changes are hampering the plans of millions of people who are interested in “encore careers” that can put their experience to work for the greater good.

New research from Civic Ventures, a think tank on boomers, work and social purpose, shows that as many as 31 million people ages 44 to 70 want encore careers that combine personal meaning, continued income and social impact. The MetLife Foundation/Civic Ventures study found that millions of these people, however, face difficulties in making the transition from earlier work to encore careers, necessitating new approaches and tools to help experienced workers plan and finance a transitional period to a successful encore. In fact, of the 9 million people who are already in encore careers, two in three experienced reduced or no income during the transition to their encores.

“There's a big payoff from encore careers, for individuals and for our entire society,” said Marc Freedman, founder and CEO of Civic Ventures and author of The Big Shift: Navigating the New Stage Beyond Midlife. “But making the switch is hard. Employers, policymakers and all of us in our own lives need to think creatively about how to make the investments in encore transitions that lead to these new, more fulfilling careers.”

The new report, Bridging the Gap: Making it Easier to Finance Encore Transitions, is the last installment in a three-part research effort funded by MetLife Foundation and conducted by Penn Schoen Berland. The first report, Encore Entrepreneurs: Creating Jobs, Meeting Needs, found that approximately 12 million Americans ages 44 to 70 were interested in starting their own nonprofits or social ventures. The second, Encore Career Choices: Purpose, Passion and a Paycheck in a Tough Economy, revealed tempered expectations by those interested in encore careers, in light of the economy – but an unwillingness to give up on efforts to create a better world.

The research was conducted from June to October 2011 by Penn Schoen Berland and included a nationally representative telephone survey of 930 Americans ages 44 to 70, an online survey of 1,408 Americans ages 44 to 70 in or expressing interest in encore careers, and an online survey of 400 potential entrepreneurs of the same age group.

“This research highlights the growing trend – even in this economic climate – of experienced Americans who want to apply their expertise and passion to new careers with purpose,” said Dennis White, President and CEO of MetLife Foundation. “Helping people manage their transition to encore careers is a key challenge. This research provides valuable information for how we, as a society, can realize the promise of millions of people as they pursue encore careers.”

Key findings from Bridging the Gap include:

The transition from midlife work to an encore career takes time and effort.

  • The 9 million people (ages 44 to 70) who are already in encore careers, on average, started to think about their encores at age 50 and took about 18 months to make the transition.
  • Many of those currently in their encores took specific steps to prepare: Nearly one in four (23 percent) participated in local volunteer programs; 20 percent enrolled in education or training courses; and 13 percent volunteered at their local places of worship.
  • Some of those interested in encore careers are not ready to make the transition: Four in 10 (40 percent) do not feel secure enough financially to make a career change in this economy; nearly three in 10 (29 percent) do not know which type of job or career to pursue; and 16 percent do not have the time to explore a new career.
  • Those interested in encore careers identified a need for transitional support through grants and scholarships for training and education (44 percent), volunteer programs (40 percent), hands-on experience through community service programs (36 percent), and additional education through community colleges or other schools (34 percent).

Financial obstacles hinder encore transitions.

  • More than two in three (67 percent) of those already in encore careers experienced gaps in their personal income during the transition to their encores, reporting that they earned no money (24 percent) or that they earned significantly less during the transition than they earned at their previous jobs (43 percent).
  • Of those who experienced time with little to no income, nearly four in five (79 percent) say they experienced a gap of six months or more; more than one in three (36 percent) say their income gap lasted more than two years. Most of those who answered (65 percent) said they relied on personal savings alone to make ends meet.
  • Half of those interested in encore careers expect the transition to be difficult and, of those, 59 percent expect the main obstacle in making the transition to be financial.

People interested in encore careers plan to work longer, which can boost their lifetime financial security.

  • The economic downturn is spurring longer working lives. Those who are not already retired say they plan to work to an average of 65.8 years old, 2.1 years longer than they thought they would before the downturn.
  • People currently in encore careers expect to work even longer, to 66.5 years old on average. Those interested in encore careers expect to work until 66.2 years on average and plan on working 23.4 hours per week for 8.5 years in their encore careers.
  • Understanding the benefits of postponing Social Security changes people’s views about working longer. Just 14 percent of people interested in encore careers indicated that they plan to wait until age 70 to start collecting Social Security benefits. But once they learned that postponing their claims would result in larger monthly benefit checks for life, three in five (62 percent) said they would consider working longer.

Recommendations for Making Encore Transitions Work

The following recommendations are based on the suite of research:

  • More encore financial planning. Advisers can help individuals compare their work and retirement options, assess their assets and make plans that may include more years of work, perhaps on more flexible schedules. The return on investment in encore transitions depends on both the length and the rewards of an encore career.
  • New saving options. Today, older adults can use 529 college savings accounts to save for their own education, not just for their children’s. Brokerages and insurance companies are creating flexible income planning and annuity products to bridge the transition income gap. Creating a dedicated vehicle – call it an “Individual Purpose Account” – to save for an encore transition can clarify assets and options. Proposed savings vehicles such as LiLAs (Lifelong Learning Accounts) could also help finance encore transitions.
  • Accelerated, accessible, affordable training. People interested in encore careers want fast-tracked courses with flexible schedules, either online or combining online and in-classroom work, and roughly half (54 percent) of respondents interested in encore careers would not pay more than $500 for additional training or education.
  • Encore education assistance. The short-term and part-time programs that encore career seekers favor should be eligible for financial aid; right now, many are not. And the Education for Public Service Act of 2007, which provides student loan forgiveness for those who pursue nonprofit or public sector work, should change to better meet the needs of people who have returned to school to help launch social-purpose encore careers.
  • Service as a pathway for boomers, not just young people. Paid or stipended national and community service opportunities (for example, AmeriCorps, VISTA, Senior Corps programs) can cover out-of-pocket expenses and provide valuable experience en route to an encore career. AmeriCorps’ basic health coverage and education award transferable to a child or grandchild (for those 55 and older) make this widely available program a viable transition option.
  • More Encore Fellowships. Short-term, part-time, paid fellowships at nonprofits can open the door to encore careers. A few corporations are beginning to offer encore transition assistance in addition to retirement benefits: Intel offers all retirement-eligible U.S. employees the opportunity to apply for Encore Fellowships of up to one year, which include a $25,000 stipend and health benefits for six months.
  • Entrepreneurship support. Boomers and older adults have emerged as the country's most entrepreneurial age group, creating jobs for themselves and others. Financing, coaching and business planning can help these new ventures succeed and grow.
  • Social Security flexibility. Streamlining, clarifying existing benefit options and creating new flexibility in starting and stopping benefits could let individuals use Social Security as an income support for encore career transitions, while preserving and strengthening its role in providing late-life financial security. More people need to know that even relatively modest levels of continued income can allow them to delay their Social Security claims, allow their savings and investments to grow, and require those assets to cover fewer years, improving their lifetime financial security.

For the full Bridging the Gap research report, go to

# # #

About Civic Ventures (
Civic Ventures is a think tank on boomers, work and social purpose. The organization introduced the concept of encore careers, which combine meaning, continued income and social impact.

About MetLife Foundation (
MetLife Foundation was established in 1976 to carry on MetLife’s longstanding tradition of corporate contributions and community involvement. The Foundation is committed to building a secure future for individuals and communities worldwide. Through programs focusing on empowering older adults, preparing young people and building livable communities, MetLife Foundation increases access and opportunities for people of all ages. Since it was established, MetLife Foundation has made more than $530 million in grants.

About Penn Schoen Berland (
Penn Schoen Berland, a unit of the WPP Group (NASDAQ: WPPGY), is a global research-based consultancy with over 30 years of experience that specializes in messaging and communications strategy for blue-chip political, corporate, nonprofit and entertainment clients.