This is the 21st century and people are living longer.
Here are the facts:
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- Medical and preventive care is much better than it was for our parents.
- People are taking better care of themselves. We’re living healthier, better and longer.
- Reaching 100 years of age is not that uncommon any more and data has shown that most people will spend an average of 25 years in retirement.
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Living longer and better lives has altered the way people look at retirement. Wealth and health will continue to be what retirees worry about most and try to plan for. Unfortunately, most of us don’t do a good job of planning for our future retirement.
What Is Retirement Planning?
There’s a myriad of definitions, almost as many as there are people. Investopdia defines it as “Retirement planning is the process of determining retirement income goals, and the actions and decisions necessary to achieve those goals.” And that’s a good one. I like it.
“Retirement planning is the thought you put into providing for income and a satisfactory lifestyle after you quit work and leave the work force. If you don’t have enough income, almost everything else will be difficult.
Retirement income was supposed to be taken care of by defined pensions and social security. However, employer defined pensions are a thing of the past and our congress will probably tinker with social security making it’s future uncertain. That puts the onus of retirement planning squarely on each of us.
Living longer and healthier lives has a significant effect on what the modern retirement looks like. Traditionally, retirement meant quitting work and adopting a lifestyle of relaxation. A retiree was not expected to continue to work, except maybe in a garden. This concept is no longer true and many retirees will continue to work in some capacity long after the retirement ceremony is over.
From my personal experience, I can say that retirement has become more satisfying, but a lot more complicated. Especially for people who retire without a lot of savings or have had to use their retirement savings for catastrophic events. The great recession of 2008 and Covid-19 has done a great job of forcing a lot of people into an uneasy and sometimes early retirement.
I’m not an expert, but I’ve there and I know what my own experience has been. The traditional retirement has been replaced by more of a career shift. Essentially, retiring has become nothing more than changing careers. I used to tell people that retiring just means you have to find something else to do. That’s never been more true than it is today.
Working after Retirement
Any semblance of a traditional retirement has been replaced by work, either part-time or full time with entrepreneurial pursuits as an employee, independent contractor, consultant, volunteer or business owner. I’ve done several of these and met a lot of people who have come out of retirement to rejoin the workforce.
There may be some times when no work is available and these could be called a “mini-retirements”. I’ve had several of these too when I used the time to volunteer or take some free online college courses.
The number one concern for most baby-boomers and millennials is personal finances and how to pay for retirement. A huge part of that is the cost of healthcare and possibly long term care. We have no idea what those may be and only about a quarter of retirees have budgeted for those expenses.
More will continue to work after retirement. Some because they want to and some because they have to. But what to do and when is a personal decision. What to do and when are the questions.
Everybody has an opinion and there’s a lot of advice, but the decisions have to be personal. A lot of decision making will be made based on how financially secure you are, what you did before and what you want for the future.
In conclusion:
In my opinion, the definition of retirement has changed and will continue evolve as our country’s political atmosphere changes and government becomes more involved in our lives. Personally, I don’t want government more involved in my life. But, there’s not a lot we can do about that and more people will have to keep working after we retire. Get a free copy of “Easy Retirement Planning” and find tons of useful information that will help plan a successful retirement.