As a financial adviser for 25 years, I’ve helped thousands of people transition from work into retirement. Yet over the past two decades, I’ve come to a surprising realization: I may never retire.
I’m hardly alone. A recent survey from Transamerica found that roughly two-thirds of boomers plan on continuing employment past the traditional retirement age of 65.
There are two major reasons people continue to work in retirement:
The idea of a retirement where a person has little responsibility and interacts with very few people isn’t appealing to pre-retirees.
1. Many people can’t afford to retire. In the early ‘90s, it seemed that most people wanted to retire as soon as they could afford it. I recall an appointment from my very first week on the job, and in came a 49-year-old man, and I remember thinking: “Now here’s someone who’s a long way from retirement.” But when we looked at his numbers and found that he’d accumulated enough money to retire, he quit his job the very next day.
The dot-com bubble burst of the early 2000s, coupled with the 2008-‘09 financial crisis, certainly delayed — and in many cases derailed — retirement plans for millions of people. Couple those setbacks with the low-interest rate environment we are in today, and many people simply can’t afford to retire in the manner they’d hoped.
2. Many people don’t want to retire. While money is obviously an important factor, there’s something else happening that explains why so many people don’t plan to retire these days. Surprisingly, boomers have witnessed the previous generation’s retirement and have decided they don’t want to live the way their parents did.
The idea of a retirement where a person has little responsibility, and, worst of all, interacts with very few people, just isn’t appealing to the current crop of pre-retirees.
Many people who leave the workforce end up struggling to find purpose and meaning in their lives. By retiring, they leave much of their social life and self-worth behind, and then with each passing year, their world becomes smaller and smaller.
How Boomers See Retirement
The fact that boomers are changing how retirement is viewed is no surprise to Catherine Collinson, the president of Transamerica’s Center for Retirement Studies. I recently interviewed her on Money Matters, our firm’s weekly financial radio program. She says, “Baby boomers have rewritten the rules in every stage of life, and retirement is no different. They see retirement as more of a transition from full-time work.”
People who are approaching traditional retirement age often want to stay involved in the marketplace, and they want to do it on their terms. While they don’t want the grinding 60-hour workweeks they may have endured at the peak of their careers, they very much want to continue to work, to serve and to add value to the lives of others.
Retirement and Me
I find myself in this same position.
Today, when I’m working with someone to plan retirement, we’ll spend ample time organizing his or her finances, but we also spend time discussing how the person will live a life of purpose and meaning in retirement. The goal in helping people prepare for the next chapter in life is not to aid them in retiring, but to help them plan and save so their paycheck is an option, not a requirement.
As Nancy Collamer, a career coach, author and Next Avenue blogger told me: “It’s not about finding a job. It’s about filling a need.”
That need can be fulfilled by starting a business, consulting, volunteering or caring for a loved one. It can also mean negotiating with an employer years before retirement and then developing a plan for part-time work during retirement years.
As for me, I am focusing on improving my skills through research, classes and conferences so my career can evolve and I can stay professionally relevant in an ever-changing world.
I’ve also prioritized my health to be able to contribute for as long as physically and mentally possible.
The new model of retirement, pioneered by younger boomers, is the way to go. With some planning and intention, most of us will be able to find ways to stay active and involved, and to live a life that not only keeps us interested, but provides value to others.
“Retire? Never! I’m going to stay in show business until I’m the only one left.”
— George Burns