Will the 'Boomers' Ever Retire... and Other Aspects of Longevity: Implications for Career Professionals
What Do We Know about Retirement?
Retirement is a very recent concept and the first company retirement plans were designed in the late 1940s - early 1950s.
'Boomers' redefined work to require it to be meaningful and are expected to redefine retirement as they see work as critical to their core identification.
A 2002 AARP study of 'boomers' indicated over 70% expected to continue working into their 70s or later. A 2003 AARP study of "pre-retirees" (over age 55) indicated that 95% expected to work after age 65. Of current retirees, nearly 80% say they feel youthful and see this period as one of continued learning and growth.
Early retirement is often driven by health issues or job loss. Many voluntary early retirees have returned to work in the past few years. Those who had traditional careers with a limited number of organizations are most likely to retire earliest voluntarily.
Men and women have very different patterns of preparing for retirement and retiring. But the change is rocky for both.
Marital satisfaction significantly drops during retirement transition period (av:10 yrs) but then usually rebounds.
Those who retire as they planned it, with good health, and who were actively involved in non-work activities before retirement are most satisfied with their retirement. Those retirees who regularly engage in active, meaningful, productive activities in retirement are the happiest.
Very few people move to a different geographic area for retirement or once retired. The ties to family and community and known patterns are important – and they are also important protectors of health. Increasingly, those who do move, do so to retirement communities within their local area. On the other hand, the number who move to be near children is decreasing. Colleges are beginning to build retirement communities near/on campus to attract alums.
RETIREMENT IS NOT ONE EVENT!
Retirement for most people is marked by changes:
Many people move into and out of "retirement" over a period of 10-12 years.
Preparing for Retirement
Most preparation is financially-oriented. Many people still assume that they will retire in one step and "vacation" for the rest of their lives.
Financial experts recommend 70-100% of pre-retirement income is needed to retire comfortably. Studies show that even after learning of the differences between what one plans for retirement and what one can afford to do, only 42% adjust their savings or retirement date to meet their stated needs.
The percentage of 40+ year old workers who have done any planning for retirement income needs has declined to less than one-third.
Single/divorced women issues:
Married couples - common issues:
Financial Aspects of Retirement - The Bad News
Only 20% of workers know when they are eligible for full Social Security benefits.
Social Security: you control when you decide to take this money. Advice conflicts – some studies show
Most workers assume they will spend 20 years in retirement (actual average as of 2002 was 19 years for men and 24 for women); yet, only 25% of those between the ages of 40-59 have saved $100,000 or more in total, excluding home equity.
Pensions cover 22% of all workers. Thus, these people have double the assets of those with other types of retirement savings and are much more likely to have a comfortable retirement.
How People Increase Income - Before and During 'RETIREMENT'
Patricia A. Frame is the founder of the consulting firm Strategies for Human Resources. We design and develop effective human resource management practices and programs which are directly relevant to achieving your organization's goals. Our solutions are tailored to your organization, based on best practices, and are simple to maintain without continued consulting support. More information on Strategies for Human Resources can be found at SHRinsight.com.
® Strategies for Human Resources, 2005, patricia@SHRinsight.com