July 30, 2011

So What Does it Mean to You?

A week or so ago I posted the highlights of a national study completed for the Sunamerica financial people. Whether the percentages mirror the population as I whole I'll leave to statisticians. But, because it was an update of a similar study done 10 years ago I found the changes in attitude important to consider. If you missed the original post, click here to read it.

What I am doing hereis looking at a handful of the findings to see what conclusions I can draw. You may disagree or have additional thoughts. I trust you will use the "comment" space at the end to add your views.

Today, 54% view retirement as a new chapter in life, rather than a winding down—a significant increase over the 38% that held a similar view a decade ago. This doesn't surprise me in the least. In the 13 months Satisfying Retirement has been around, I have not had one single indication from any source that retirement means a rocking chair, 18 holes of golf, and a life of complete leisure.

Exactly the opposite has been true. Now retirement is a word that describes a completely different phase of someone's life. It is a time of exploration, of discovery, or growth. It no longer means the end of work. Rather it means having the freedom to choose to work full time, part time, cycling in and out of employment, or even starting one's own business. In fact, I get the very real sense that retirement has the potential for being one of the fullest and most gratifying periods of life.   

Retirement is being postponed: Pre-retirees say they now intend to delay retirement by five years—from age 64 to age 69—triggered in part by increasing longevity, as well as the recession and financial need. Again, I would concur though I would add an additional reason: lots of folks enjoy what they do and see no reason to stop. If someone is good at what he or she does, do they suddenly stop being competent at a set age? Of course not. If retirement equals a time of increased choices and freedom, then one of those choices is to decide retirement begins when you say it begins.

•Retirement no longer means the end of work: Almost two-thirds say they would ideally like to remain productive and include work in retirement. As already noted, working during retirement is an increasingly common occurrence. Financial reasons may be an important motivator. But staying vital, relevant. and productive, or fostering a sense of contribution are legitimate reasons, too. Because what you do is fun may be your motivation. Maybe you've always wanted to open a book store, coffee shop, or fabric store. Do it now. The Sunamerica study found The top reason people want to work during retirement is “the stimulation and satisfaction” rather than the money.

•85% say they now appreciate the importance of quality relationships with their friends and family even more after the recession. Maybe it is a function of maturity. Maybe it is a growing sense of one's own mortality. Maybe it is understanding that you aren't taking anything tangible with you when you die. Whatever the reason, the understanding is that family, friends, and solid relationships support you during good times and bad. When your financial boat has sprung a bunch of leaks, it is relief to know there are people who have your back. There are folks who will love you and help you and even care for you regardless of the state of your 401(k).

•Three-quarters say the last several years have provided a much-needed financial wake-up call, and 81% report they have learned important lessons regarding saving, investing and preparing for retirement. I hope that is true. Too many times in the past we have seen a crisis, like a huge gas price increase, or an economic downturn, prompt similar pronouncements of a new awakening to financial reality. Then, when things start to get better sales of giant SUVs jump, folks "trade up" to bigger homes, and savings rates approach zero.

In this case the proof will be in our actions when things improve and stay that way. 78% say they can still have a fulfilling retirement by being more financially disciplined. That is an encouraging number, but will it hold?

I am well aware there are many retirees who have been severely hurt by the economic downturn. I know there are millions of folks who find themselves upside down in their mortgage situation through a combination of mistakes, both theirs and by banks or lenders. Like you I read about foreclosures, social welfare safety net cutbacks, and people desperate to hold it together. The optimistic numbers in this study are not meant to suggest everything is swell. That is clearly not the case. Some of our fellow citizens are really hurting and need our help and support.

I think the message from this study is that for the many retirees there is an attitude of hope, of adjustment, and of a sense of renewal that bodes well for all of us. Personally, I am very glad my retirement is not that of previous generations. I'm too young for the rocking chair on the porch just yet.

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  1. Hi Bob, I agree with your conclusions. I know my husband and I see retirement as a new beginning, more for him than for me. His retirement from the military 10 years ago just brought the need to find a new job doing about what he was doing before because we still had kids at home. His upcoming retirement will be a big change in that he won't work at a job but wants to do things like volunteer with Habitat for Humanity and travel.

    For me, I'm lucky in that I get to work at home, make my own schedule and do more of the things I enjoy now, mixed in with some part time work so I look forward to continuing what I love to do.

    We have definitely been trying to save more and put our money into buying rental homes where we get more return than most investments.

    We definitely aren't ready for the rocking chairs either!

  2. Good Morning Joan,

    Just maintaining your blog and keeping all its parts up-to-date must be almost a full time job!

    I think your husband will enjoy the transition into a less structured situation. I did some work with Habitat for Humanity helping to build 3 homes. I found them to be a tremendous organization doing great things for folks who need every break they can get.

    For this blog, I am glad retirement is so multi-dimensional. I don't think I could write for very long about the best golf clubs to buy or what easy chair is most comfortable.

    My wife and I owned four rental homes in the late 90's. It was an interesting experience that taught us a lot about people and we made some money.

  3. Bob,
    This is indeed interesting information. What I wonder is if people are actually thinking more independently than they might have in the past or whether this just reflects changing realities that cause people to think different from their parents but still go with the flow of society.

  4. Ralph,

    Interesting, and probably unanswerable question! Because the same questions were asked 10 years ago I'd lean toward the former interpretation. Since the economic and political mess we are in at the moment was only a gleam in someone's eye a decade ago, normally a study like this tracks attitude shifts among a certain subset of people. Then again, I could be completely wrong.

    Whatever the cause, the change in attitude is good for everyone, I think.

  5. Another great post Bob, you certainly serve the retirement community well. The thing that stands out to me is the decision to postpone retirement from 64 to 69. While some people may not be affected by this decision I have to make the point again that the clock is ticking...

    I am turning 65 this years and have been fully retired for four years and semi-retired for eleven. There are just many things that I can't do today that I could even five years ago. Aging is an on-going process, it is not an event. It is very possible that putting off until later will mean that you will no longer be able to do some of the things you had planned on doing in retirement.

    If you are financially able don't put off retirement too long. As you often say, and I agree, retirement is just moving from one stage of your life to another. Don't shortchange that next part if you don't have to.

  6. RJ,

    Firstly, I hope your wife is feeling better. It isn't much fun to be sick on the road.

    Your point is an important one and the subject of an upcoming post: how long do you delay travel before it is too late due to health issues? Is it worth it to spend money now on trips and experiences while you are able to truly enjoy it, even if you are busting your budget a bit?

  7. Complete agreement with you here: "... retirement has the potential for being one of the fullest and most gratifying periods of life. "My wife and I are not there yet (not sure if we'll know for sure when we are), but the present empty nester stage is great. When we do get time together it's wonderful to be able to plan things that suit us -- and just us, if you know what I mean.

    Also, you wrote: "I know there are millions of folks who find themselves upside down in their mortgage situation through a combination of mistakes ...". On 1.3.2009, my blog published this post: "110th United States Congress", here: http://givemeamomentblog.blogspot.com/2009/01/110th-united-states-congress.html

    Some may want to look it up to help remember a time when both the US House and the US Senate worked mostly in unison. Unfortunately, in my view, far reaching policy mistakes currently affecting as you say millions of folks were made in that congress


  8. I look forward to that post. It definitely applies to Yvonne and I. Our month long trip out to California in 2009 was more enjoyable than this one due to not having as many health issues that we have now. I fear that his may be our last major trip; we will likely restrict ourselves to weekies instead of monthies. :)

    My wife is doing better on some of the issues but added another one yesterday. We should be home today and she can see her doctor tomorrow to sort all that out. We had a good time but it was cut short due to health issues. So I am looking forward to what you have to say in that area my friend.

  9. Hello QwkDrw,

    Is it better when Congress works together, and passes lots of laws, or doesn't work together at all, and therefore can't do anything? That is an open question that may be answered in the next 48 hours.

    Yes, there are some major advantages to an empty nest lifestyle. And I know exactly what you mean.

  10. Hi RJ,

    Glad to learn that you and Yvonne will be home and can get some medical attention. From my days of extensive business travel I remember there are feel things worse than being sick in a hotel room.

    I'm not quite sure what conclusions I will come to in that post since I haven't written it yet. But, traveling while still healthy is a subject my wife and I have both discussed quite a lot recently.