Retirement will likely look very different from what it has looked like in the past.

Several demographic and lifestyle trends are emerging that will change the way Americans plan and invest for the future, according to a new white paper from RBC Wealth Management – U.S.

“Twenty years ago, retirement was a fixed point in time — you fully retired and spent your remaining years relaxing. It’s different now,” the paper titled, “Rewriting Retirement,” states. “Today, retirement is a time of life that brings you the freedom to continue working and have time for leisure, family, volunteering, pursuing hobbies and travel.”

Already, there may be a transformational shift in the mindset of today’s retirees that the report authors think could be helpful for future retirees.

As part of the report, RBC polled more than 1,400 Americans (half pre-retirement, half retired) and found that while those still in the workforce fear running out of money in retirement, current retirees worry more about being able to maintain their quality of life.

Pre-retirees also have retirement goals that contrast sharply with the goals of people who have already retired. Those in retirement focused more on quality of life, health and relationships, whereas the top goal before retirement is travel.

Here are the five demographic and lifestyle trends that the report outlines as disruptive to future retirement.

1. The Modern American Family

According to the report, changing social norms and the rise of millennials are changing the structure and look of American families.

For example, in the 1960s, more than 73% of all children were living with two parents in their first marriage, according to Pew Research data from 2015. The data shows that today less than half are.

The increased prominence of divorce, remarriage, cohabitation, single-parent households and multigenerational households is driving this change, RBC says. In addition, millennials are more likely to delay or eschew marriage altogether. (They also divorce at a lower rate.)

“These trends present a range of new factors to consider, including legacy planning, expense funding, family dynamics and geographic considerations,” the report says.

2. Longer Lives, Better Health

Medical advances have extended life expectancy and increased vitality. For example, the report says, medical procedures like hip replacement or cataract surgery are seen as routine and increasingly common as people age.

“Armed with increasing good health, today’s retirees are starting new businesses, remaining physically active and engaging family and friends,” the report says.

According to RBC, this has led to enhanced resources that tap into the passions of older Americans, who are now in a position to act on them.

3. Burden on Medicare

Medicare spending currently makes up 15% of the federal budget — a number that is expected to grow as the program continues to expand, according to 2018 data from Henry J. Kaiser Family Foundation.

“Preserving Medicare’s long-term viability will require changes, since health systems continue to refine the services provided, as well as seek cost relief to fund care,” the report says.

According to RBC, likely outcomes include continued shifts to cost-conscious care, as well as higher premiums for those who are yet to retire, with the latter disproportionately impacting those deemed “high income.”

4. An Aging Workforce

As more members of the Baby Boom generation reach traditional retirement age in good health, many will delay their exit from the workforce, the report says.

The percentage of people 65 and older who work has grown 117% over the past 20 years, and trend lines show that growth will continue as older Americans launch new careers or continue to work later in life, according to Bureau of Labor Statistics data from 2014.

5. Rise of the Longevity Economy

The average age of Americans continues to rise, and, according to the report, a new economy is emerging to meet the needs of the growing 50-plus segment of the population.

RBC believes this has implications for virtually every sector, from technology to health care, housing and beyond.

“This growing infrastructure can help support seniors as they age, offering goods and flexible services unheard of just a generation ago,” the report states.

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