Ahhh, retirement. Nine holes in the morning, the beach on the weekends, sunset picnics and… the office for a few hours a day?

Not too long ago, the whole point of retirement was not working. But today’s retirees are increasingly counting themselves among the job-seekers. Roughly three out of four workers over age 50 say they plan to work at least part-time in retirement, according to a 2010 study by the Families and Work Institute; currently about 20% of retirees have a job. Indeed, working during retirement is becoming the “new normal,” the study says.

For some retirees working means an encore, a chance to dive into something they’ve always been passionate about. Others are driven by a desire to stay vital and stave off boredom. But for many people, working past 65 is a necessity, not a luxury. Considering the average boomer couple currently has a retirement savings shortfall of about $30,000, according to a recent study by the Employee Benefit Research Institute, it’s a trend that experts predict with accelerate. “Boomers aren’t as financially prepared for retirement as earlier generations,” says Mary Johnson, a senior policy analyst at The Senior Citizens League, a non-profit senior rights advocacy group.

Regardless of the reason, a post-career job hunt can drastically affect where you’re going to settle down when you retire. That’s why SmartMoney.com’s second annual survey of the best places to retire comes with a twist. Like last year, we’ve analyzed tax rates, cost-of-living numbers and real estate prices to compile a list of less expensive alternatives to several traditional retirement hotspots. But this year we also combed for relatively low unemployment rates and thriving job opportunities for seniors.

In the current economy, of course, finding work isn’t easy in most regions of the country. What’s more, it takes employees over 55 more than 40% longer to get hired than their younger counterparts, according to AARP. Meanwhile, nest eggs are shrinking and retiree income is stagnating. (One recent example: The Social Security cost-of-living increase announced last week is likely to be at least partially negated by rising Medicare premiums, experts say.) That means finding an affordable place to live has become more important — and more difficult. Palm Beach, Florida, for example, has a median home price of $827,300, a cost of living that’s 109% higher than average, and an unemployment rate pushing 10%, according to Sperling’s Best Places. In other words, not a keeper for the list.

Instead, here are seven underrated retirement havens (complete with comparisons to their more expensive alternatives) that are relatively affordable, delightful and full of opportunities for work and play.

Santa Fe, New Mexico

Joel Stein, a corporate bond broker from New York City, and his wife retired to Santa Fe in 1997. The reason: “It’s like a microcosm of New York but without the hustle and bustle,” he says. “It’s a small town but it’s sophisticated — there’s art, opera and hundreds of restaurants. It’s a nice place to retire but it doesn’t feel like a ‘retirement town’.”

Nicknamed “City Different,” Santa Fe is indeed unlike the trendier Sedona, an Arizona town that’s often touted as a best place to retire. Unemployment is just 5.3%, thanks to Santa Fe’s thriving tourism business and government payroll. (Santa Fe is the state capital.)

The arts scene is one of the best you’ll find anywhere. Santa Fe is dotted with 240 art galleries and the home of Art Santa Fe, an international art fair that attracts buyers and tourists from around the globe. In fact, Santa Fe’s art market is the fourth largest in the country in terms of sales, according to the University of New Mexico Bureau of Business and Economic Research. Stein says he and his wife have embraced the scene. He leads historic walking tours of the area and works for pay at the Museum of Natural History; she is a docent at a local art museum.

For retirees who want to work, tourism-related jobs are a good bet, says Steve Lewis, a spokesperson for the Santa Fe Convention & Visitor’s Bureau. In addition, many people retire here to reinvent themselves. “We get a lot of people who have always wanted to be artists and they come here to do it,” he adds.

Medical and travel information: The Christus St. Vincent Regional Medicare Center, which is the regional medical center for northern New Mexico, is in Santa Fe. The Albuquerque airport, which serves 10 major airlines, is about an hour’s drive.

* by Catey Hill
Sunday, November 20, 2011