Retirement Today: An Evolution of Work and Leisure

The concept of retirement continues to evolve as our idea of work changes and the economy shifts. Retirement goals are different today, especially for Baby Boomers, where the second half of life is for opportunities not afforded in the first and traditional expectations are being challenged as more people set out to live their golden years.

Entrepreneurialism, freelancing and the gig economy are taking on new meaning. A different kind of work, an offshoot of leisure, is being paved as part of a new path towards retirement. What’s most important is enjoying a retirement lifestyle that leaves you fulfilled daily. And establishing goals and objectives before tackling the finances can make a difference. (For more, see: Working During Retirement: Making the Most of It.)

Depending on whether or not you want semi retirement or entrepreneurship in later life, planning has to be different than in the past and your financial plan should reflect both your dreams and the financial reality that will make them possible.

The Evolution of Retirement

In the colonial days, there was really no concept of retirement at all. In the beginning, it was: birth, a brief childhood, work then death. We worked as long as health permitted, often on the family farm.

Then came the New Deal in the 1930s, following the Great Depression. The mantra became progress at all costs. Social Security was introduced in 1935, ushering in a new age of retirement.

The next “era“of retirement was the 1950s and 1960s. The Dell Webb Corporation opened Sun City Arizona’s first five model homes, and a new culture emerged from age segregated retirement communities - an entire community dedicated to “leisure and recreation” for the active retired adult.

With insurance companies heavily invested in the pension business, this led to the “selling” of retirement. Madison Avenue painted a picture of retirement panacea. The dominant commercial image of retirement was along the lines of sipping tropical drinks on an exotic beach making tee times all day.

What Retirement Means Today

Today, the whole concept of retirement seems to be changing again as the Baby Boomer generation continues its “rebellious journey” through life. The search for ways to stay healthy and vital are gaining momentum. The second half of life, to some, is now a chance to do things that the past could not accommodate - reinvention, liberty and opportunity. (For related reading, see: How Does My Part-Time Job Affect Social Security?)

How to Approach Retirement Planning

Do you know anyone who went back to school after 50? Started a new business or career after 60? Got married after 70? Given these developments, the first step is to establish goals and objectives.

It is important to spend enough time considering the type of lifestyle one wants in retirement before thinking about how to create a financial plan that allows to save enough money to achieve it. Here are some questions to consider:

  • Do you want to fully retire?
  • Semi-retire?
  • Change careers?
  • Start a business?
  • Volunteer?
  • Do you want to keep doing what you do now but maybe change the ratio between work and leisure?
  • What else do you want to do with your time? New hobbies? Travel? Time with family and friends?
  • Where do you want to live? Do you want a second home? Snow bird?

Reflecting on what you want individually or with a spouse will keep you motivated. Additionally, it keeps you accountable. You can make it fun by drawing or writing your retirement lifestyle desires somewhere you can see it regularly.

Once you have forged a vision of your ideal retirement lifestyle, then the planning and number crunching starts. This includes: preparation of your net worth statement, spreadsheets with retirement income targets and range of outcomes, asset allocation, insurance and estate planning, Social Security and Medicare optimization.

Retirement can be part of a lifelong path towards fulfillment. However, in order to achieve your retirement dreams, you will need to establish goals and objectives in addition to saving enough money to make your dreams come true. (For more from this author, see: How Longevity Is Transforming Retirement Planning.)

 

Disclosure: Evan M Levine is an SEC Registered Investment Advisor