The reality of retirement is rapidly changing. The baby boomer demographic is about to unleash an unprecedented wave of retirement. However, the traditional view of retirement as a transition from work life to life after work is obsolete. Personal development and talent is the key to our future success. The new trajectory of retirement has already become an act of improvisation.
The Old Retirement: Rest, Reward, Leisure
The word retire means to withdraw, retreat, or remove oneself from a particular situation or circumstance. In this sense, it is a kind of leaving or departing from something we used to do. The word retire hinges on the word “from;” that is to say, we withdraw from something. The reality of aging and extended longevity is that we retire into something new.
The old retirement is a reward for years of work, an opportunity to rest, and a time to enjoy leisure activities, hobbies, and recreation. It originates in the rather bleak and sterile notion a lock-step life of education – employment – retirement. This definition of retirement is irrelevant.
The origins of retirement from the workforce at age 65 can be traced to the latter half of the 19th century. During that period of time, the average life expectancy of a male was approximately age 54. The vast majority of people died well before they could collect government benefits.
Our life expectancy has increased dramatically since the 19th century. The vast majority of people now live long enough to collect public pension benefits for twenty or thirty years. If we applied the life expectancy standard of the 19th century to our present circumstance, pension benefits would begin at age 89.
The essential question about our retirement focuses on what kind of life we are moving toward or into. Stopping work suddenly can result in an identity crisis, if we have over-identified with our career. When we retire large parts of our identity are torn away in order to make room for new possibilities.
Retirement is actually a poor label for this important threshold in life. It is not a word that inspires a sense of direction or forward momentum. The reality is that retiring is not as much about a withdrawal from work as it is about moving into a new and fulfilling phase of life.
At the same time, the use of the word retirement is commonplace. The meaning of words can evolve over time and take on new senses of meaning. It is time to evolve the definition and to understand retirement as a powerful creative threshold in life.
Retirement in Motion
The Future of Retirement: Life After Work? offers interesting insight into retirement trends around the world. Today, some people believe that they will never be able to retire. Many retirees live in fear of outliving their money. We are the victims of our own economy.
The financial and emotional reality of retirement is often more difficult than people realize. Here are some key statistics provided in the study:
- 12% of working age people feel they will never be able to retire
- 43% of working age people do not know when they can retire
- 42% of working age people expect to semi-retire at age 57
- 64% of semi-retirees regret giving up fulltime work so early
- 21% of retirees saw their income fall by more than half on retirement
- 45% of retirees are or expect to be financially supporting another family member
- 63% of retirees worry they do not have enough money
- 42% of retirees felt their retirement aspirations could not be reached
Aging is expensive. Increased longevity places increased pressure on financial resources. We must financially support ourselves in retirement for increasingly longer periods of time. Elder poverty is becoming a fierce problem.
One obvious way to increase our financial resources is semi-retirement or delayed retirement. The purpose of semi-retirement is to provide a financial and psychological bridge between working and being fully retired. Simply, we continue earning some sort of income over a longer period of time through some modified version of work.
The Future of Retirement Study revealed that the motivations behind semi-retirement include remaining active, enjoying their work, and preference to build in a transition period. There were also negative reasons given that focused on financial concerns and health problems.
Having adequate financial resource and maintaining good health are basic requirements of living. However, these basic necessities are coming under increasing pressure during the final quarter of life.
The Baby Boomer Retirement Tsunami
A new and compelling story is emerging. Our old assumptions about retirement are no longer useful. The final quarter of life has become a crucible of significant financial challenges, health issues, and social obstacles.
Baby boomers are a large, disruptive demographic. They started to reach age 65 in 2011. By 2029 the entire boomer wave will be 65 or older. Over the next twenty years, unprecedented numbers of people will be moving into some form of retirement. What that retirement will look like, however, is uncertain.
The next-generation of retirees is about to put on the single largest most watched improv act in history. It is an act that will set the tone of public policy, business innovation and the behaviors of generations to follow – let’s hope it’s a good one – and a little fun too.
– Disruptive Demographics – Why Baby Boomer Retirement Will Be An Improv Act
As individuals, we need to engage is significant personal growth and development in order to successfully navigate our future. As a society, we need to build new social platforms that are responsive to change. All improvisation demands that we interact with our own uncertainties in order to forge a path through them.
The disruption created by the retirement of the boomer generation is a unique opportunity to improve our social, political, and economic ways of life.
Toward the New Retirement
What is the new retirement?
Our ideas about retirement are changing. It is no longer a one size fits all proposition. I believe that the idea of retiring as a process of withdrawing, retreating, and removing is flawed and inadequate.
Retirement is an act of redefining and inventing new possibilities for living. We do not withdraw when we retire, we move into something new that we have created for ourselves. We do not retreat from the world around us, we find new ways to engage with it. We do not remove ourselves from society, we find ways to increase our contribution to others.
- Working Vocation: Retirement is not the conclusion of our work in life. The new retirement will transform our relationship to work.
- Money and Meaning: Our relationship with money will evolve. We will become less open to making money at the expense of pursuing of meaning and purpose in the final quarter of life.
- Health care: Normal aging means that our bodies gradually deteriorate over time. We will begin building institutions that are proactive with respect to health care and education. Corporations producing products and services that are unhealthy will improve or go out of business.
- Entrepreneurship / Solopreneurship: Retirement will increasingly become an entrepreneurial venture. Retirees will need to supplement their income through work. Some will become solopreneurs. Retirement will embrace work and earning and income in new ways.
- Ageism: Ageism, or prejudice toward people on the basis of their age, will intensify. Boomers are already being negatively portrayed as a kind of economic “burden” on society. Ageism exposes the fragility and weakness of society.
I rarely close an article with a quote. However, Harry Leslie Smith beautifully captures the essence of the new retirement. I recommend that you read the entire article.
What one expects from retirement is different for everyone because we are unique creatures. Yet all of us must realise that we are on a journey, from the moment we are born until the day we die. The final stage in our lives should be treated like all the other episodes in our brief existence – as an adventure filled with discovery, joy, wonder, sorrow and bliss.