Demographic changes have turned the standard definition of retirement upside down. Life expectancy has increased steadily over the decades. Now, a man who reaches 65 can expect to live another 18 years; a 65-year-old woman can expect to live 20 years. Plus, people work longer than in past decades, thanks to better health and a higher level of education, which generally leads to more gratifying, less-strenuous work.

With more time and opportunities, many retirees are phasing in and out of work, taking part-time, seasonal or consulting jobs, or acting as entrepreneurs. Some post-66-ers work because they need the money, but the majority are taking advantage of the resources they have (including Social Security, savings and maybe a pension) to seek work that's more enjoyable and less stressful than their career was, says Nicole Maestas, a senior economist at the Rand Corp. For many, "retirement connotes a broader set of options," she says. "It's a new phase of life."

Having more time to work and play may sound delightful, but figuring out how to do it over 20 or 30 years is no last-minute exercise. Experiment by pursuing hobbies, volunteering at places where you might want to work, and thinking carefully about whether you want to downsize or move to another city altogether, says Larry Rosenthal, a certified financial planner in Manassas, Va. "People retire to a place and then think, 'The grandkids are back where we were,' and they want to move back."

One way to get a sense of what you want to do a few years hence is through a "practice retirement." That idea, proposed by investment firm T. Rowe Price, has you continue to work at your career job but back off on saving for retirement -- say, by contributing only enough to your 401(k) to get the company match. Then you can use the money you've freed up (plus vacation time) to try out your ideas, such as traveling cross-country or turning your hobby into a side business.

Cutting back on contributions to savings in your early 60s may sound like heresy, but the key is staying on the job and waiting to take Social Security until full retirement age (66 until 2021) or later. For each year you delay taking Social Security after 66 until age 70, you get an 8-percent bump in benefits. And while you're still pulling in a paycheck, you can let your retirement savings grow, even if you're not contributing to your accounts.

"It's a way to stay in the workforce and have a little fun while doing it," says Judith Ward, a senior financial planner at T. Rowe Price.

(Jane Bennett Clark is a senior editor at Kiplinger's Personal Finance magazine. Send your questions and comments to moneypower@kiplinger.com. And for more on this and similar money topics, visit Kiplinger.com.)xxx