As our lives have been getting longer and healthier – compared to prior generations – some people advocate doing away with the concept of retirement altogether. In support of that idea, increasing numbers of workers report in surveys that they expect never to retire, and not just because they can’t afford to but often because they like the idea of continuing to work.
While I celebrate people who are trying to break stereotypes, I respectfully disagree with those who advocate eliminating the concept of retirement altogether. Let’s take a look at recent trends that might have inspired the “no retirement” point-of-view and consider an alternative perspective.
In the 20thcentury, prior generations experienced a life cycle that could be generally be broken into three stages:
Middle age/career/raising family
The problem is, as our lifespans continue to be extended, we can’t just keep adding the extra years to the retirement phase of life. It just takes too much money to be retired for 25 years or more, which can easily happen if you retire in your early to mid 60s. Also, many unforeseen and challenging events can happen in the economy or your life that can derail the careful retirement plans you might have made.
Here’s another perspective on reframing the arc of life in the 21st century: With the extension of lifespans, we’ve effectively created a second “middle age.”
Retirement vs. second middle age?
As you transition out of your first middle age, it’s important to distinguish whether you want to transition into full retirement or into your second middle age. During your second middle age, you’re still active, vital, and productive, but you’re no longer raising a family or aggressively pursuing the career of your first middle age.
“Freedom” can be one good word to describe this second middle age. At this stage, you’re free from the expectations of others. Free from preconceived notions of how you might live your life. Free from the responsibility of raising a family. Free to do what you’ve always wanted to do.
You can break free from the advertising influences that tell you to spend your time and money in unhealthy and unfulfilling ways. You can break free from the consequences of unconscious choices you might have made earlier in your life.
Another good focus during this second middle age can be “independence.” Your financial independence may come from wages, self-employment, financial resources, government benefits, efficient sharing of resources, or, more likely, a creative combination of all these solutions.
If you’re working during this second middle age, you might gain independence by redefining your career to better suit your goals and circumstances at this stage in your life. You might choose to do more work that you like and less work that you don’t like. To make that happen, you’ll need to keep your job skills up-to-date, which may require a recommitment to learning, obtaining new credentials, or pursuing alternative careers. You might even work fewer hours to free up time to pursue your interests.
Of course, this could also mean you’ll make less money, but perhaps you’ll buy less stuff because you’ll be making more conscious spending choices. If so, you’d be in good company. One study from Merrill Lynch and Age Wave shows that 95% of retirees prefer enjoyable experiences rather than buying more things.
You’ll want to think hard about this question: Are you willing to spend less money to gain your freedom in retirement? Or are you willing to work to earn more spending money? Often you can’t have it both ways, so you’ll need to make a potentially hard choice.
I believe that people who advocate eliminating retirement are really just focusing on their second middle age, without thinking about what might happen afterwards.
Plan beyond your second middle age
The goal, not just in this second middle age but also in retirement, is to extend the life period of freedom and independence for as long as possible – to be physically fit, mentally sharp, functionally independent, and financially secure well into very old age, perhaps well into your 80s or even 90s, if possible.
However, no matter how healthy and capable you may be in your second middle age, many people may still experience a period of physical decline and illness in their late 80s or 90s. After your second middle age comes your final life stage, which we might call “retirement.”
During this period, you’ll most likely be unable or unwilling to work for pay and will need to rely exclusively on financial resources, family, and government benefits.
The fact is, as you age, your needs will change. As you plan for your retirement, you’ll want to plan for all phases of your rest-of-life—your second middle age and your retirement. You’ll need to make financial and life-planning decisions for all these stages, so you’ll have the resources you need to support yourself no matter what stage you find yourself in.