On January 1, 2011, the first Baby Boomers turned 65, thus beginning the collective retirement of the Boomers, one of the greatest financial migrations in history. But as anybody who endured the financial bruising of the Great Recession can attest, a lot of people who were in the home stretch to retirement saw their retirement severely downgraded, or postponed for several years, by the beating their investment portfolios took when the world financial markets melted down.
At the same time, insurers have begun to market the notion of “longevity risk,” that is, the possbility of outliving one’s retirement savings. Longevity risk is predicated more on the likelihood that one simply has not saved enough and/or had too much of their nest egg robbed by market volatility. In an age where pensions are a thing of the past and the future of Social Security remains ever in question, longevity risk has become a pressing concern indeed for anybody even approaching the age of 60 these days.
But longevity risk also has something to do with a double-edged miracle futurists expect to occur eventually: a medical breakthrough that will suddenly and radically extend our lifespans. Living to 130 sounds great until you suddenly realize that you don’t know how to pay the rent for those extra 50 years.
With the actual retirement age for many people pushing back by at least a few years, the prospect facing most Boomers today is that they will most likely have to work at least a little if they want to maintain their pre-retirement lifestyle and afford the inevitable increase in health care costs that come with older age. Retirement planners have long used as a spur to clients the grim prospect of being a Wal-Mart greeter during the years they were supposed to be RVing across the country, sipping lemonade and visiting with grandchildren. Now, that seems less like a worst-case scenario and more of a new normal where people can expect their primary careers to end between 60 and 70 and to have to come up with some kind of second act to sustain themselves for the rest of their days.
The big question is: is this such a bad thing? My dearly departed father, an attorney, never had any plans to retire and he practiced law until the day came when he was too ill to do otherwise. He loved his work, and his work was to some degree his recreation as well. What the heck was he going to even do with himself if he didn’t need to go to his office every day?
Increasingly, Boomers I talk to are of this mindset, and it makes sense, if you go by the Boomer stereotype of a generation that has always exhibited a certain restlessness and a willingness to try new things, if only to keep themselves from being bored. Some insurer surveys in the past year have taken the approach that the need for a working retirement is a good thing, and is a chance for Boomers to reinvent themselves with a second career that might be one of those dream jobs, or a chance to take some of their savings and invest it in a new business opportunity. The old dream was traveling around the world nonstop; the new dream is opening that little bakery you always dreamed about, or starting an online business.
Personally, I suspect this is not something that will remain confined to the Boomers. Most Gen Xers and Millennials I talk to are very much of the same mindset; full retirement seems like an impossbility, and working forever is just what we do. The trick is to find a line of work where you actually would want to work forever. Me, I’m a writer. I’ll do it until my fingers start bending the other way. (Yeesh…nice image there, Bill.) For me, the trick is making sure that I pair my writing with my need to pay the bills. So far, so good. And once I hit my silver years, the idea is to keep plying my trade, maybe not as frequently, maybe not as lucratively, but working all the same. Staying sharp, keeping active, remaining in the game.
But work is work, after all, and not everybody is keen to have to punch in somewhere until the day they can’t. I’m particularly interested in finding out who is angry or upset or just plain regretful that their retirement dreams of idle comfort have not come true. There are a lot of those out there, and I know they all have compelling stories to tell, especially to 40- and 50-somethings in their prime earning years. Who are these people, with a sad tale to tell? They’re right alongside their friends and colleagues who are still whistling while they are working. I’d like to know what makes the difference between them; somehow, it’s not really about money.
We will be running a little poll on LifeHealthPro about the realities of working retirements, and I encourage you all to check it out and let us know what you think. This is a topic that is only going to become a greater part of our professional realities, and the sooner we square with that, the sooner we can make this into something that is a positive for everyone.