THE RETIREMENT CAFÉ
                                                                              By Ernie J. Zelinski
 
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  THE NEW RETIREMENT

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The New Retirment Ain't What Retirement Used to Be

The way retirement is shaping up, how will one know for sure when he or she has retired?
— Robin Fowler

The new retirement reality may be a messy proposition.
— Alicia Munnell, director of the Center for Retirement Research at Boston College.

The New Retirement 

"Retirement ain't what it used to be," is a common statement by retirement experts. They cite "the new retirement," which involves a paradigm shift from the old way of looking at retirement. "A new [retirement] model is emerging,” states Ken Dychtwald, gerontologist and author of Age Power: How the 21st Century Will Be Ruled by the New Old.

Everyone needs a reason to put their shoes on in the morning [when they retire]. If you put on the slippers, you'll end up dragging your feet all day.
— Norma Fagan, Dir. of the Retired & Senior Volunteer Program of Monroe County

"It's replacing that old image of the life process where you learn twenty years, you work forty years, you lie in a hammock for twenty years.” Dychtwald concludes that today's retirees are placing a good deal of value on reinvention and personal growth in the new retirement model.

No doubt retirement planning is important. You must take steps to ensure that when the bell rings to announce your retirement, you’re ready for what’s in front of you. The time available for marital, personal, social, creative, and family activities expands considerably when the hours previously taken up with full-time employment cease.

How you manage time is just as important as when you are in the workforce. A large retirement income and the best retirement advice in the world won't help if you don't do something intelligent with them.

There used to be a sharp division between work and retirement. Retirement in this regard isn't a cut and dried affair anymore. This is why so many people have fears about retirement.

Indeed, the differences between work and retirement are increasingly blurred. For many people, retirement is no longer the end of their working life. It is a time to blend work with a nice mix of leisure activities to create the work/life balance they have always wanted.

A 2002 survey conducted for the AARP (American Association of Retired Persons) indicated that 80 percent of baby boomers planned to work at least part-time after retirement. Few of the people intended to work because they needed the money. Many people will continue to work, not to make money, but to keep busy, have some social contact in a work environment, and pursue personal interests.

Retirement? You have to be kidding! Only one generation of Americans was ever fortunate enough to have this luxury. The rest of us [Americans] will probably die in a Walmart parking lot while on duty [in a retirement job].
— Anon, in response to a retirement article

Even people who don't have to work in retirment plan to do so. For instance, nearly two-thirds of wealthy people in England plan to keep working in some way, according to a 2010 survey by Barclays Wealth Insight.

The shift toward retirement with at least some work involved has happened over the past few years, mainly due to better health in later years and a higher life expectancy.

About 60 percent of wealthy baby boomers in England said that that they envisage always being involved professional or independent work of some type. They remain actively engaged in their work way beyond their retirement years. regardless of the fact that they have little financial motivation to do so.

In short, their work is their passion and to stop would lead to boredom and dejection.

Webster's dictionary refers to retirement as "secluded and withdrawn." This may fit the description of a few of today's retirees but it certainly doesn't fit the large majority. Many people are retiring into something new instead of just retiring from a job.

I used to have dreams that I died at my desk.
Now that I've retired, I don't have those dreams anymore.
— Haselback (commenting on an online article about retirment.)

Given that retirement for many people doesn't mean total withdrawal from all paid employment, but only retirement from a specific work career, many researchers now loosely define retirement as "receiving a pension from a career employer or receiving old-age social security benefits from a government agency."

The new retirement is not merely a time to stop working; it's a transition from a life of work to a life of many choices.

The choices can be exciting or overwhelming. Whereas traditional retirement represented limited choices, such as occasional travel, shopping, spending more time with grandchildren, playing bingo, visiting friends, and watching lots of TV, the new concept of retirement represents many more choices — not only leisure activities but also working part-time in an enjoyable job, indulgence in a creative venture, and pursuing exciting dreams.

Whatever the challenge of a new age, in the end what really counts is not the years in our lives but the life in our years. It is not about longevity, but the depth of life. Long ago I learned that age does not wither the mind if people remain positive. No one is too old to set another goal or to dream a new dream. It is a mind game. As Churchill suggested, "The empires of the future are the empires of the mind."
— Singapore Retiree Jennie Chau

Today, there is a lot more variability in how individuals make the transition from paid work to retirement than there was in the past. Some people do leave the workforce entirely to a life of total leisure. Others start their own businesses. Still others, wealthy enough to do so, become philanthropists.

Moreover, retirement is no longer a one-time event nor is it a one-way and irreversible exit from the workplace. Many retirees immediately go on to new "fun" careers, sometimes with little or no pay, while others may not work for a year or two and then find work as part-time consultants, often with their old employers.


   

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The New Retirement According to the

Allstate Financial Retirement Survey

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According to the first Allstate Financial's Cost of Leisure Index released in August 2010, American baby boomers are looking forward to a new retirement that will be more than just rest and relaxation in a rocking chair.

The Cost of Leisure Index, part of the Allstate Financial Retirement Reality Check, rated the baby boomers' most desired retirement activities and the amount they intended to spend on these leisure activities.

The [new] retirement, to one which has to look forward.
1. Get up at 4am to be at work at Mickey Ds.
2. Have your 25-year-old boss tell you that if you don't work harder and do more overtime, he will replace you with another old geaser.
3. On the way home you pick up old cans to sale for some extra money.
4. You get the letter telling you that you don't qualify for food stamps, You were born here that makes you not a candidate for stamps.
5. You ask your dog if you can have the other half of the can of dog food, and he tells you to go F$$$ off.
6. You read in the old paper that you picked up at work, and read that the US GOV. just gave away more money to the poor of some country that you never hard of.
So go retirement."
— Anon, in response to MarketWatch article Four ways 60-year-olds can save their retirement

Interestingly, the Allstate Financial survey found that 63 percent of Baby Boomers felt that retirement will be the best years of their lives. Moreover, 82 percent of those surveyed felt that the new retirement age will be more fun and rewarding than the retirement age of their parents and 65 percent felt their "new retirement" will be more active.

"Baby Boomers are looking forward to an active retirement, full of the leisure pursuits that they currently enjoy today," declared Tom Wilson, president of Allstate Financial. "In fact, while in many instances surveyed Baby Boomers were accurate in estimating the costs for their favorite activities they are still not saving enough money to actually enjoy what they told us they want to do during retirement."

We have a manufactured vision of what [the new] retirement is, and that doesn't necessarily correlate with reality. Unless you have a well-thought-out scenario, you're going to be in for a shock at retirement.
—  Paul Allen, 64, a self-employed software developer in Dallas

If you are not saving enough for retirement, you must redefine retirement  by adjusting your ideas about the way you will live and when you will stop working. You will also have to prepare for a lower standard of living than had while you were working full time, and consider a part-time job in retirement.

If you are in your 50s or 60s, consider delaying retirement for a few more years to generate more savings and contribute to a pension plan and Social Security for a longer period of time to accumulate more in these accounts so that you can collect more when you do actually retire.

The Latest on the New Retirement

The "new retirement" for Americans is looking newer and newer and by no means is it all positive. By redefining the "new retirement" to your terms, however, life could actually get better for you.
 
First, lets look at the not-so-good news about the new retirement:

1. You can't rely on pensions for your retirement income since most people will not have a government or corporate pension. Point is, governments and corporations can no longer afford pensions for employees.

2. The stock market does not give returns anything close to what stockbrokers tell you.

3. The 401(k) retirement plan is not a guarantee of an retirement income.

4. Social Security is not only underfuned, but has no actual funds in its trust fund, given that the bankrupt U.S. government has borrowed the money and replaced it with an I.O.U.

Why shouldn't retirees expect some reduction in Social Security and Medicare benefits, and soon? Before we retired, or will retire, we lived beyond our means by voting for those congressmen who would keep taxes low and borrow from the trust funds to pay government bills. Woe to the politician who would ask us to fully pay the taxes necessary for the services we expected from government.  This large accumulated debt to the funds is coming due. So we have an obligation to help pay it off by accepting less from them or paying higher taxes on our retirement income. As retirees, we have no right to just pass our debt off on our kids. We certainly helped create it and should help pay it off.
— Werner Gruhl, Columbia (Commenting on  a newspaper article about Social Security)

Even with the not-so-good news, a person who saves properly can have a modest retirement income and top it up with some money from other sources. Fact is, over 90 percent of people can save more money if they put their minds to it.  Almost everyone, from people earning just above the poverty line to people with upper six-figure  salaries, spends 50 to 75 percent more than they need to on their daily expenses.

If you want to retire early, you need to save as much money as you can. And if you don't have an adequate retirement income, the "new retirement" is an opportunity to let go of a regular career and adopt a new lifestyle of several careers or income streams.

This means that the new retirement will not mean a life of total leisure. This is not all that bad for most people, however. Studies indicate that when people retire with little to do, their life expectancy decrease. Why? No doubt work gives people purpose, and people without purpose don’t live as long.

The Old Retirement That Preceded

 the New Retirement

How did the concept of pensions and retirement to help people leave the workplace earlier than they have to get started? Initiallly, this was a government concept, but only for employees who could no longer work.

It started with the Roman Empire and continued through the Civil War. The idea at that time, however, was that pensions were only extended to soldiers who became disabled on the battlefield, for people who were forced to retire early, in other words.

Ernie J. Zelinski has written three books that I bought and enjoyed reading. I highly recommend his books. They help you think "out of the box" and make you realize that retirement is unique for every person. His three books are How to Retire, Happy, Wild, and Free — retirement wisdom that you won't get from your financial advisor, The Joy of Not Working — a book for the retired, unemployed, and overworked, and Career Success WITHOUT a Real Job.
Retirement Help on Baby Boomers Planning for Retirement
 Website

The first non-government pension plan to allow employees to retire with dignity was created in 1875 by the American Express Co. It was felt and piano manufacturer Alfred Dolge, however, who conceived of the modern company pension plan to allow employees to retire with an income when they were unable to work anymore in their old age.

Dolge established a retirement plan designed to pay anywhere from 50 to 100 percent of wages to long-term employees who could no longer work due to disability, which often was a result of being older. His company withheld one percent of each employee's salary, placed it in the retirement fund, and added six percent interest each year.

Social Security in the United States was created in 1935, thus formalizing the concept of retirement for older employees. At first, retirement years were short. Most people retired at seventy when the life expectancy was much lower. Similarly, retirement age, originally set at seventy but later reduced to sixty-five, was introduced in Britain under the 1908 Pensions Act, when average life expectancy was around fifty.

In those days, when people retired, they left the workplace for good. For several decades, retirement was associated with a leisurely lifestyle; it was a time to relax and escape from the responsibilities and worries of life. You retired at sixty-five and walked away from your job of forty-five years to travel, play golf, or just waste your life away watching TV.

Even today, pick up retirement brochures directed at people fifty and over and you will often see pictures depicting retirees golfing, playing tennis, taking exotic cruises, and eating at outside restaurants. Nonetheless, in the modern world, retirement can no longer be taken for granted as a purely leisurely lifestyle.

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The New Retirement According to AIG SunAmerica's Re-Visioning Retirement Survey

It's difficult to stereotype retirees today, particularly because they cover such a huge age range and are involved in a broad mix of work-leisure arrangements. Nevertheless, the 2002 AIG SunAmerica Re-Visioning Retirement Survey conducted by the Harris Poll organization found that there are four distinct segments that define today's American retirees.

Here is a summary of the portraits of the four different segments.

1. Ageless Explorers — constitute 27 percent of retirees and see retirement as an exciting new experience in their lives. They will only partially retire and intend to do everything possible to be busy instead of bored. They are highly educated and are the wealthiest of the four segments, having an average net worth of $469,800 and an average household income of $64,800. Having saved for an average of twenty-four years, they feel financially comfortable. They plan to make the most they can out of retirement, mixing periods of work, learning, leisure, and community service.

2. Comfortably Contents — constitute 19 percent of all retirees. Unlike the Ageless Explorers, Comfortably Contents look forward to traditional retirement. Although they expect to enjoy retirement, they want to relax as much as possible by traveling and enjoying other recreational activities. Beyond recreational goals, their major goal is to have no goal. They have little interest in working or contributing to society. They're close to the Explorers in education level and net worth, having saved on average of twenty-three years. Comfortably Contents expect to be financially comfortable in retirement. Their average income is $61,200 and their average net worth is $367,500.

3. Live for Todays — constitute 22 percent of all retirees. They have
the same aspirations as the Ageless Explorers in that they have no
intention of living the traditional retirement. Indeed, they may even
be more interested in personal growth and reinventing their lives.
Alas, these individuals have lived too long in the here and now and
only saved for an average of eighteen years. Average income is $46,300, and average net worth is $222,600. Many don't feel financially comfortable and likely "go to bed worried." In all probability, Live for Todays will continue working in retirement not just for the fun of it, but due to too much instant gratification that they experienced in their earlier years.

4. Sick & Tireds — constitute 32 percent of all retirees. They are
likely to have been forced into retirement by poor health and have
low expectations for making it the best time in their lives. They are the least educated and have the fewest financial resources
of the four segments. This segment saved for an average of sixteen
years; they have an average household income of $31,900 and average net worth of $161,200. Retirees in this segment are likely to be less active — traveling less and participating less in leisure activities — than the other three segments. They are also the least likely to explore and develop their human potential.

Undoubtedly, these categories may be useful for the marketing personality. However, as someone once said, "There are two types of people: Those who put people in categories and those who don't." In this particular case, it's better to forget about these categories and see ourselves as unique individuals.

We all have our special blend of financial assets, personal traits, and retirement dreams. By making the most of what we have, each of us can design an individual retirement lifestyle that is right for us, and which may not apply to anyone else.

Alan Dickson, now in his fifties, is a father of five who retired in his forties. Dickson of Duncan, British Columbia was asked what retirement means to him by Canada's MoneySense magazine. He replied, "I guess retirement is more about being able to wake up in the morning and choose what you want to do, as opposed to saying, 'This is what I have to do in order to make a certain amount of money to pay the bills.' "

Although retirement ain't what is used to be, ultimately, retirement is still a state of mind. The ideal is to live life on your own terms, doing what is right for you.

 Whether you want to work full-time, change to a part-time fun career, or cease working altogether, the key is to forget how the media, financial corporations, and others define retirement. Let retirement be a metaphor for a life-course transition that encompasses improved health, more time with friends, enhanced
social life, creative pursuits, and interesting leisure activities.

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COPYRIGHT © 2017 by Ernie J. Zelinski
Author of The World's Best Retirment Book
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