A Snapshot of Phased Retirement To track the evolution of these phased retirement arrangements within various organizations, we held in-depth interviews with 20 of our original survey respondents in the educational sector, private manufacturing and services sectors, nonprofit organizations and public administration. In the university environment, for example, phased retirement generally involves a professor teaching one semester and taking the next one off. The broad range of programs across organizations paints a fascinating portrait of evolving trends in retirement. The diversity is not surprising, given that economic and labor conditions affect different industries and organizations differently. Moreover, phased retirement arrangements vary along with the organization's business philosophy, people values and workforce demographics, not to mention the overall corporate culture and specific benefit and compensation programs.
Arrangements tend to be more informal than formal.
Many organizations hire their own retirees after a certain waiting period. The following is a small sample of current practices in phased retirement. DROP participants begin accumulating retirement benefits in a separate DROP account while they continue to work. Phased retirees may continue working for up to 60 months after their normal retirement date, while their monthly retirement benefits accumulate in the Florida Retirement System trust fund, earning tax-deferred interest. At the end of the DROP period, the employees retire, receiving a lump-sum distribution from their DROP account in addition to their regular retirement benefits.