The Rise of Semi-Retirement for Dow Incorporated Employees: A Flexible Transition to Retirement

BBB Update

Key individual tax changes from Trump's 'big beautiful' bill
Current law vs. final legislation

Current law	Final legislation
Standard deduction
$15,000 single; $30,000 married filing jointly for 2025	$15,750 single; $31,500 married filing jointly for 2025
'Bonus' deduction for older adults
$1,600 for age 65 and older for 2025; $2,000 unmarried / not surviving spouse for 2025	$7,600 for age 65 and older; $8,000 for unmarried / not surviving spouse; both from 2025 through 2028
State and local tax deduction (SALT)
$10,000 limit through 2025	$40,000 limit for 2025; increases by 1% through 2029; reverts to $10,000 in 2030
Child tax credit
Max credit of $2,000 per child through 2025; refundable portion $1,700 for 2025	Max credit of $2,200 per child; refundable portion $1,700 for 2025
Estate and gift tax exemption
$13.99 million single; $27.98 million married filing jointly for 2025	$15 million single; $30 million married filing jointly for 2026
Tax on tips
N/A	Deduct up to $25,000 per year from 2025 though 2028
Overtime pay
N/A	Deduct up to $12,500 per taxpayer from 2025 through 2028
Auto loan interest
N/A	Deduct up to $12,500 per taxpayer from 2025 through 2028
Auto loan interest
N/A	Deduct up to $10,000 of annual interest on new loans from 2025 through 2028
Trump Accounts for child savings
N/A	One-time $1,000 credit to account per child born between 2025 through 2028
Charitable deduction for non-itemizers
N/A after 2021	$1,000 single; $2,000 married filing jointly; permanent after 2025

Source: CNBC

'Dow Incorporated employees considering semi-retirement can benefit from not only a flexible work schedule but also the financial advantages of continuing to contribute to retirement savings while maintaining a sense of purpose and social engagement.' – Michael Corgiat, a representative of The Retirement Group, a division of Wealth Enhancement.

'Transitioning to semi-retirement can be a smart strategy for Dow Incorporated employees to balance continued financial growth with personal well-being, offering both income opportunities and a healthier work-life balance.' – Brent Wolf, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article, we will discuss:

The benefits of semi-retirement for Dow Incorporated employees, including financial and psychological advantages.
The economic opportunities, such as contributing to retirement accounts and delaying Social Security benefits.
Important considerations when transitioning to semi-retirement, including taxes, health care, and the impact on Social Security benefits.

As retirement approaches, many Dow Incorporated employees are rethinking what it means to 'retire.' Traditionally, retirement has meant leaving the workforce entirely, but this notion is shifting, with semi-retirement becoming an increasingly popular and viable option. Semi-retirement offers a flexible way to transition into retirement while maintaining professional involvement, whether driven by a desire to stay active or by financial needs.

Semi-Retirement: What Is It?

Semi-retirement is when employees reduce their work hours, while still engaging in part-time or freelance opportunities. For Dow Incorporated employees, this could involve cutting back hours at a full-time position, taking on part-time roles, or venturing into self-employment through consulting or freelance work.

Some may need to be in semi-retirement due to insufficient savings or unexpected financial circumstances, even after reaching the typical retirement age. Others may feel motivated to continue working due to personal fulfillment, a sense of purpose, or the social connections that work provides. Semi-retirement offers a balance between leisure and activity, benefiting many by enhancing their overall well-being.

Important Takeaways:

Dow Incorporated employees who transition into semi-retirement can still earn an income while enjoying more free time.
Semi-retirement provides psychological as well as financial benefits, helping individuals maintain relationships and stay engaged.
It's important to understand the tax implications, and the effects on Social Security benefits and health care coverage, before entering semi-retirement.

The Economic Advantages of Semi-Retirement

One of the most direct financial benefits of semi-retirement is the ability to supplement retirement funds. Even though part-time jobs may not offer the same salary as full-time positions, they can still contribute to a financial cushion for retirement.

Dow Incorporated employees in semi-retirement may still be eligible to make contributions to retirement accounts such as IRAs. Individuals over 50 can take advantage of catch-up contributions, allowing them to save even more for retirement. In 2025, the IRA contribution limit is $8,000, including a $1,000 catch-up contribution. Dow Incorporated employees who participate in a 401k can benefit from a $7,500 catch-up contribution, increasing the maximum contribution to $30,000 for those over 50, and up to $35,500 for employees aged 60 to 63.

Additionally, continuing to work part-time can delay the start of Social Security benefits, which can increase the monthly payout when benefits are eventually claimed. For Dow Incorporated employees who expect to live longer and wish to increase their retirement income, delaying Social Security can result in an approximately 8% increase in benefits for each year they wait after reaching full retirement age (FRA).

Semi-retirement can provide a cushion against unexpected financial setbacks, such as market downturns or unforeseen expenses. With a second income and the ability to delay drawing from retirement accounts, employees can strengthen their financial future.

The Psychological Benefits of Semi-Retirement

While the financial incentives are clear, semi-retirement also offers important psychological benefits. The transition from a full-time career to retirement can be overwhelming, especially for those who have worked for decades. The loss of a job-related identity and the potential for social isolation can take a toll on mental health, leading to increased risks of loneliness, anxiety, or depression.

Semi-retirement provides a solution by maintaining social connections and a sense of purpose. It offers structure while allowing for greater freedom, which can help employees stay engaged and emotionally fulfilled. Kevin Won, a financial advisor with The Retirement Group, suggests that reducing work hours rather than quitting altogether can contribute to a more successful retirement.

Not all Dow Incorporated employees are suited for semi-retirement, however. Teresa Ghilarducci, a labor economist, warns that those in high-stress, low-control jobs might find that continuing to work, even part-time, could exacerbate stress and health issues. It's important for each employee to evaluate their own situation and whether part-time work will improve or hinder their quality of life.

How to Determine If Semi-Retirement Is Right for You

For Dow Incorporated employees, deciding if semi-retirement is the right path involves considering both financial and personal factors. Financially, it's important to assess how much more needs to be saved and how long one must work in semi-retirement to cover retirement expenses. Thoughtful questions such as 'How much more do I need to save?' and 'How long will I need to work to support my retirement?' can guide the decision-making process.

Employees with adequate savings who still want to build their nest egg can use semi-retirement as an opportunity to work more flexibly and add to their retirement funds. This additional income could provide a cushion against economic uncertainties.

For those seeking purpose or a new challenge, semi-retirement may involve consulting, freelancing, or taking on projects that align with personal interests. Dow Incorporated employees who are motivated by a desire to remain engaged in meaningful work will find semi-retirement an ideal option.

Things to Consider Before Moving Into Semi-Retirement

Before transitioning to semi-retirement, Dow Incorporated employees should carefully consider the potential impact on their health care, taxes, and Social Security benefits.

Taxes:

Working part-time during semi-retirement can impact tax brackets. Additional income from part-time work or retirement account withdrawals may push employees into a higher tax bracket, increasing their tax liability. It's important to stay informed about tax changes and plan accordingly.

Social Security:

If an employee is under full retirement age (FRA), working part-time while receiving Social Security benefits may reduce the monthly income. For example, in 2025, employees under FRA who earn more than $23,400 may see a reduction of $1 in Social Security benefits for every $2 they earn above this threshold. Once FRA is reached, any withheld benefits will be reinstated.

Health Care:

Retirees under 65 must purchase health insurance through the marketplace until they are eligible for Medicare at age 65. Employees staying in their jobs may continue to access employer-sponsored insurance. Understanding how health care costs will be managed during the transition to retirement is crucial, especially for employees who will continue to rely on company health benefits.

The Bottom Line

Semi-retirement offers Dow Incorporated employees a flexible, fulfilling way to ease into retirement without losing the financial and social benefits of work. With the potential to supplement retirement savings, delay Social Security claims, and maintain social connections, semi-retirement may provide a balanced approach to transitioning into full retirement.

By weighing the financial and personal factors, employees can make an informed decision that aligns with their long-term goals, leading to a smooth and sustainable retirement journey.

This growing trend reflects a shift toward a more gradual, controlled approach to retirement, with nearly 30% of Americans over 60 considering semi-retirement ¹ as a way to preserve both financial stability and personal fulfillment.

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Sources:

1. ' 4 Key Reasons Retirement Is Out of Reach for Many Older Americans ,' by Cynthia Meason. Yahoo!finance, 17 June 2025.

Other resources:

1. 'The Rise of the Semi-Retired Life.' Investopedia, 25 Oct. 2016, www.investopedia.com/articles/retirement/102216/the-rise-semi-retired-life.asp .

2. 'The Amazing Tax Benefits of Semi-Retirement.' Can I Retire Yet?, 25 May 2020, www.caniretireyet.com/tax-benefits-of-semi-retirement/ .

3. 'Delayed Retirement Credits.' Social Security Administration, www.ssa.gov/benefits/retirement/delayed-retirement-credits/ .

4. 'How Working in Later Years Can Improve Your Health.' Investopedia, 28 May 2025, www.investopedia.com/articles/retirement/052816/how-working-later-years-can-improve-your-health.asp .

5. '5 Advantages of Semi-Retirement.' Minster Bank, 15 Sept. 2024, www.minsterbank.com/5-advantages-of-semi-retirement/

How does The Dow Chemical Companyâ€™s pension plan structure impact an employee's retirement benefits when considering different retirement ages? The Dow Chemical Company offers various options in its pension plan, and understanding these can significantly affect financial planning for retirement. An employee must weigh the benefits of retiring earlier with potentially lower monthly payments against the advantages of working longer and how this aligns with personal retirement goals and expectations.

The Dow Chemical Company’s pension plan and retirement ages: The Dow Chemical Company’s pension plan structure impacts employees' retirement benefits based on their retirement age. Retiring earlier results in lower monthly payments due to reduced service time and potential early commencement penalties, while working longer allows for more service accrual and higher monthly benefits. Employees must evaluate how these factors align with personal retirement goals, as choosing to retire early might not provide as much financial security as delaying retirement(The Dow Chemical Compan…).

What are the implications of the 20% mandatory withholding tax on lump-sum distributions from The Dow Chemical Company's pension plan, and how does the option to roll over affect an employeeâ€™s tax situation? Employees taking lump-sum distributions need to be cautious about this withholding rule as it can impact their immediate financial needs. Additionally, the rollover option provides a strategy to defer taxes, which can be crucial for long-term financial health. Employees should consider how to best utilize these rules in their personal financial planning.

20% mandatory withholding tax on lump-sum distributions: Lump-sum distributions from The Dow Chemical Company’s pension plan are subject to a 20% mandatory withholding tax if not directly rolled over into another qualified retirement plan. This tax can significantly impact an employee's immediate finances. However, opting to roll over the lump sum to a qualified plan defers taxation until funds are withdrawn, allowing employees to manage their tax liabilities better while continuing to grow their retirement savings(The Dow Chemical Compan…).

How does The Dow Chemical Company ensure that employees understand their eligibility for retirement benefits based on various service and age criteria? Eligibility considerations based on service years and age can significantly influence the retirement timeline for employees. Moreover, itâ€™s essential for employees to be well-informed about these factors to make educated decisions pertaining to their retirement and whether adjustments to their career plans are needed for maximizing benefits.

Eligibility for retirement benefits: The Dow Chemical Company outlines eligibility for pension benefits based on a combination of service years and age. Typically, employees become vested after three years of service or upon reaching age 65 while still employed. The company ensures that employees are informed about these eligibility criteria through various resources, such as the Dow Benefits Service Center, enabling them to make informed retirement decisions(The Dow Chemical Compan…).

In what ways can employees of The Dow Chemical Company appeal decisions regarding their pension benefits, and what processes are in place to facilitate these appeals? The appeal process is critical for employees who might feel that their benefits have not been administered correctly. Understanding the correct procedures and having access to the right resources can empower employees to effectively advocate for themselves in the face of administrative decisions.

Appealing pension benefit decisions: If employees believe there has been an error in the administration of their pension benefits, The Dow Chemical Company provides a formal appeal process. Employees can file a claim, and if denied, they have the right to appeal the decision. The Retirement Board oversees these appeals, and employees must follow the outlined procedures for their appeal to be considered(The Dow Chemical Compan…).

What strategies can employees of The Dow Chemical Company employ to maximize their pension benefits while transitioning to retirement? Employees must navigate complexities such as contribution limits, benefit formulas, and personal retirement savings. A strategic approach, which includes understanding the timing of retirement and how it interacts with pension claims, can lead to more favorable financial outcomes in their retirement years.

Maximizing pension benefits: Employees at The Dow Chemical Company can maximize their pension benefits by carefully planning their retirement timing. Key strategies include working longer to accrue more service years, reviewing contribution limits, and understanding the benefit formula used. Aligning personal savings and pension claims with the optimal retirement age can result in more favorable financial outcomes(The Dow Chemical Compan…).

How can retirees from The Dow Chemical Company navigate survivor benefits, and what are the eligibility criteria for spouses or domestic partners? Survivor benefits are an essential aspect of retirement planning, especially for employees concerned about providing for their loved ones after death. Itâ€™s vital for employees to understand both eligibility and what benefits their partners might receive, fostering peace of mind during retirement planning endeavors.

Survivor benefits for retirees: Retirees from The Dow Chemical Company can opt for survivor benefits to provide financial security for their spouses or domestic partners. Eligibility for these benefits depends on the plan's structure, and employees should understand the options available to ensure their loved ones are covered after their death. These benefits include continued monthly payments or lump-sum options depending on the election made at retirement(The Dow Chemical Compan…).

How does The Dow Chemical Companyâ€™s defined benefit pension plan differ from other retirement plans, and what should employees know when comparing their options? Employees need to understand the distinctions between defined benefit plans and other types such as defined contribution plans for effective retirement planning. This understanding will help them better appreciate the benefits and risks associated with their choices and aid with decision-making processes.

Comparing defined benefit pension plan: The Dow Chemical Company offers a defined benefit pension plan, which differs from defined contribution plans like 401(k)s. In a defined benefit plan, the company guarantees a specific monthly benefit upon retirement, typically based on years of service and salary, whereas defined contribution plans depend on employee contributions and investment performance(The Dow Chemical Compan…).

What resources does The Dow Chemical Company provide to employees seeking detailed information about their retirement options, and how can they effectively utilize these? Accessing the right resources can bridge knowledge gaps regarding pension plans. Employees should know about dedicated pathways to assistance, such as benefit service centers and consultation avenues, to fully leverage their benefits package.

Resources for retirement information: The Dow Chemical Company provides several resources for employees to access detailed information about their retirement options. The Dow Benefits Service Center and My HR Connection are key tools where employees can request pension estimates, understand payment options, and clarify eligibility criteria. These resources help employees make informed decisions regarding their retirement planning(The Dow Chemical Compan…).

With changes in IRS rules becoming increasingly relevant, how do employees of The Dow Chemical Company stay informed about updates that may impact their retirement savings? Employees need to be active participants in their retirement planning by staying abreast of legal and regulatory changes that can influence their financial strategies. Having a clear understanding of these regulations can help ensure compliance while maximizing possible financial benefits under updated laws.

Staying informed about IRS rules: Employees of The Dow Chemical Company must stay informed about IRS rules that may affect their retirement savings. Changes in tax laws, contribution limits, or distribution rules can significantly impact financial planning. The company provides updates and resources to ensure employees are aware of relevant regulatory changes that might affect their retirement strategies(The Dow Chemical Compan…).

How can employees of The Dow Chemical Company reach the benefits service center for additional inquiries regarding their pension plan, and what information should they prepare beforehand? Knowing how to contact the benefits service center is crucial for employees seeking clarity on their pension plan benefits. Preparing relevant information ahead of time can streamline the process, allowing for a more productive engagement with benefits specialists and ensuring that employees receive precise guidance tailored to their situations.

Contacting the benefits service center: Employees seeking clarification about their pension benefits can reach the Dow Benefits Service Center via phone or online through the Message Center. It is recommended to have personal identification and details of the pension plan ready to streamline the inquiry process. Proper preparation ensures a productive conversation with benefits specialists(The Dow Chemical Compan…).

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For more information you can reach the plan administrator for Dow Incorporated at 1919 torrance blvd Torrance, CA 90501; or by calling them at 900-999-1009.