Retirement is becoming just the ‘third half’ of life. Here are the 4 key mindsets we've identified among the new generation of retirees

The idea of retirement as envisioned by our parents is undergoing a radical change. Once viewed as the last chapter before death, it has now morphed into an intermediate phase that is no longer synonymous with old age or complete inactivity. Today, a typical retiree can reasonably expect to live another 20 to 30 years, ideally in good health, provided they continue to exercise both body and mind. In this context, the word “retirement” seems obsolete. It is perhaps more fitting to refer to it as the “third half” of life.

However, retirement often entails a profound change of identity, especially if work played a substantial role in shaping one’s identity. Losing much of what defines us while still possessing the energy and desire for a working life can be profoundly disorienting.

Getting the transition to retirement right is vital for retirees, their colleagues, and organizations. Through our research and interactions with professionals navigating this shift, we have pinpointed four psychological mindsets associated with the transition to retirement.

The switch

Vanessa was a partner in an audit firm in Paris. At the age of 51, she decided to cease her professional activity. “I was getting old and realizing it,” she says. She gave herself two years to organize her succession and slowed down, changing her occupation day by day.

“Things had changed in my head; it had become difficult to stay at 100%,” she says, adding that she was thinking about her “future job.” A year after her retirement, she remains active, but in a different field, now running a bed and breakfast hotel in Marseille. She takes daily walks to the market to source produce for her guests, and winters in the southern hemisphere for two months during the winter lull.  

“Switch” professionals like Vanessa describe a natural transition to their “third half” identity. The common feature among them is how carefully they prepare with small incremental changes and open discussions about their plans. They seem to have departed from their former professional identity without regret, moving towards a new identity that they may not idealize but recognize for its positive benefits.


Denis retired a year ago. He is critical of his former professional environment, where he feels there is still a strong “alpha male” culture and excessive professional commitment. Nevertheless, he serves as a non-executive director of various organizations, one of which is a former client of his.

Other aspects of his work, however, are completely new to him. He has learned to cede executive control and take a position of oversight, which is both rewarding and different. Above all, he has adopted a holistic approach to life, leaving more room for what he finds deeply fulfilling and interesting. For instance, he takes pleasure in coaching a junior basketball team in his spare time.

Individuals who are “transcending” share similarities with professionals going through a rapid “switch.” However, the distinction lies in their desire to maintain a professional identity and shift in steps. They exist in a liminal stage, straddling between two places. Even if they are ready to engage in new activities, they do not wish to completely give up their professional lives, whether in terms of activities or the customers they serve. They have one foot in the new and one still in the old, offering a sense of psychological stability and solace.


Gregory, a former accounting partner, retired and became an independent consultant. He left at the mandatory age of 55 years old, relatively disillusioned but in good health. Relieved to have left the political aspects of his former organization behind, he is bitter about his new role, which he expected to have more purpose. He feels alone and lacks administrative support. To Gregory, enforced retirement felt like a schism.

Much like the “transcending” retirees, those in the “regret” mindset find themselves stuck in the middle between their professional and retiree identities. Their choice seems more painful, caught between two identities that they fundamentally dislike. Two common characteristics include a form of pessimism regarding their future and a lack of attachment to their current professional identity.

Although they are often strongly critical of their former role, they would have stayed in their profession if they had been given the choice. In short, they are deeply ambivalent and in a subdued emotional state. The former working identity was known but unwelcome, whereas the anticipated identity as a retiree remains vague and induces anxiety.

The false start

Akiko reached an agreement with their law firm before leaving, allowing them to continue the activity of counsel and work with their team and clients. Knowing that they would remain with their organization, they did not prepare for retirement. “It’s a bit egotistical… What am I supposed to do? Be like the mastermind that liquidates itself?”

Akiko has maintained elements of their prior role, including the pension plan, office, and parking space under the building. People who “false start” struggle to let go of their attachments, move on, make themselves redundant, and properly plan for succession. There seems to be a denial of the need to bring new generations into the mix. They never really leave the starting blocks, hardly shedding their professional identity. Their day-to-day activities are very similar to the ones they have been doing until now. Instead of accepting their status as retirees, they deliberately, and often to their detriment, find themselves incapable of letting go of their profession.

Why retirement matters and what to do about it

Future retirees are often disoriented and relatively anxious about this new phase in their lives. As a result, organizations must carefully consider their approach to dealing with this segment of their talent pool. Should they opt to let them go completely, or do they see an advantage in maintaining a close relationship to benefit from their experience, knowledge, or network? To support and guide them toward the chosen strategy, organizations might consider the following initiatives:

Demystify procedures and guidelines

Given that retirement remains a taboo subject in many organizations, with expectations, procedures, and available options often unclear, it is important to be transparent about the company’s strategy.

Discussing the consequences of retirement together allows both parties to prepare. This can include conversations about financial considerations, access to the workplace, participation in events, and use of email. Financial incentives could be structured to discourage people from “hanging on” indefinitely.

Celebrate and honor the retiree

Organized programs can initiate and support the transition into retirement, as well as an event to say goodbye and honor their legacy. This experience can be positive for both those leaving the organization and their colleagues. Sabbaticals near the end of the executives’ tenures can provide a psychological release to explore new horizons. Assigning people ambassadorial roles at conferences and other visible and high-status events also sends an appropriate signal to the market and the individual.

Provide support

Providing people with time for reflection and creating a space for reflective practice is essential to help them prepare for retirement. Individual coaching or, better still, group coaching, can be invaluable in this regard. This allows them to reflect on their transition, verbalize their feelings and misgivings, and receive the advice and benchmarking they may need.

Despite being laden with anxiety, the so-called third half can be the most glorious chapter of life. Liberated from the shackles of insecurity and aware of their competencies and strengths, people can be empowered to contribute to broader social systems. Rather than perpetuating a taboo, healthy companies address the subject early, identify the specific mindset of each individual, and gently guide them towards a different and more constructive future.

Graham Ward is an adjunct professor of organizational behavior at INSEAD. Isabelle Lebbe is a partner in the investment management practice of Arendt & Medernach.

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