Top 10 Facts You Should Know
Before You Retire
Fact # 1-Retirement isn't fun for some people!
In my discussions with clients, many of them are frustrated with the concept of retirement. They have the financial means to retire, so it's not the money discussions that cause the sense of unease. These are people who have had successful careers. They like what they do, and the idea of retiring doesn't appeal to them in the slightest. I see many professionals working well into their 70s with just as much enthusiasm as they had in their 20s and 30s.
The "retire at age 65" thing is an outdated concept that was dreamt up in the days when life expectancy was less than 70 years of age. It really was just putting in a couple of post-career years until the law of averages caught up to you. But we didn't foresee the growing army of 90-somethings who are 25 years past their supposed "out to pasture" date. Twenty-five years is as long as many careers used to be!
That's not to ignore the reality of aging, and everyone will eventually be forced to slow down or stop working. For some, they are more than ready to hang up their skates so to speak at 65. And for others, poor health will make the decision for them. But for more and more people, 65 is just a checkpoint where they can look at taking a slightly different approach to how they apply their energy and commitment to work.
Fact # 2-Not everyone wants to pack it in at 65.
Let's look at what's driving this trend where individuals wish to work beyond age 65. Firstly, there's longevity. Many older people are living healthier lifestyles. They're working out and plan on staying healthy well into their 70s. With the prospect of living to age 90, they see 65 as simply a number. After all, retirement at age 65 was defined by the Napoleonic era. In those days, the average life span was 65 years. Today, life span has increased dramatically. Science has advanced so drastically that the person who will live to 1000 has supposedly already been born.2
Now that's an extreme example but living to 100 is very much in the cards. And that's great. But when the retirement at age 65 concept was created, it did not envision potentially having to support yourself for decades. You might run out of money because you didn't work long enough. It's this longevity that's making people reconsider retiring at 65. They are healthy now and realistically will be healthy until age 75 or beyond. That's an additional 10 to 15 years of potential employment that was never considered in any retirement planning scenarios.
Fact # 3-Work can be very rewarding at any age.
There's also the issue of work fulfillment. Many older people still like to work. They pursued post-secondary education in the fields of medicine, law, business, accounting, dentistry, engineering, and other white-collar disciplines. The work is stimulating, engaging, and lucrative. It gives them purpose and social standing. Age 65 comes along and they are still totally in their zone professionally. For these people, retirement is a dirty word. They want to get every ounce of success that they can from their lives. For them, the best part of their careers is yet to come even though they've been working for decades. An ideal day for them means interesting meetings with clients, working on a complex project, or developing a product.
There's the identity aspect too. For many people, work is the foundation of their personal identity. Doctors like being "doctors." Dentists like being "dentists." Lawyers like being "lawyers." Marriage counsellors like being "marriage counsellors." You get the idea-the work ties in with who they are as a person. Take that away and it creates a void that's difficult to fill, and this triggers psychological issues like depression and anxiety. Many people have already figured this out and know they want to continue working as long as they physically can in order to maintain their identity.
Fact # 4-Work can be good for you socially and physiologically.
One of the most important aspects of work is the daily structure and social contact it provides. People like to go to work so they can engage with other people. This socialization includes clients, co-workers, suppliers, regulators, and the cleaning staff. Many people need this regular contact and want to remain engaged. A perfect example is Dave, a retired engineer. I asked him what he missed most about the workplace. "It's the interaction," he says. "It was great to work on exciting projects with my co-workers. Now, I find myself out to pasture with limited interaction. Retirement is kind of lonely and not very fun."
Extended working solves several retirement problems. One is financial. You can still earn money just like when you were younger. You also have the social outlet of your career that potentially engages you with people or intellectual challenges. If you enjoy these aspects of your work, you won't be bored. As well, you don't have to plan for decades of retirement because you'll be in the workforce longer.
According to a 2006 study in the UK done for the Department for Work and Pensions, a lot of evidence shows that work is generally good for physical and mental health and well-being. And not working is associated with poorer physical and mental health and well-being. 3 Work can be therapeutic and can reverse the adverse health effects of unemployment. That's true for healthy people of working age, for many disabled people, for most people with common health problems, and for people collecting social security. Work is generally good for health and well-being.
A long-term study published in the Annals of Behavioral Medicine analyzed the lives of almost 700 people, categorizing them by their level of career success. Its first conclusion was unsurprising: a high level of attainment (defined by job prestige, leadership roles, or a respectable annual income) lowered mortality risk. After all, it makes sense that you're likely to be healthier and happier if you can afford to treat yourself. It also found that men who had an appetite for genuine hard work lived longer. Men who were deemed conscientious-those who exhibited self-discipline, ambition, attention to detail and a good work ethic-lived longer than their more laid-back peers, even in cases where their careers never really took off.
Now don't think you've got it made if you're one of those burn out cases. That type of stress can be damaging. But for those who love what they do, the research suggests this work extends your life.
With this in mind, why are we encouraging our age defying population to retire? It's bad for their morale and creates social isolation. We've been sold a bill of goods and it needs re-jigging.
Fact # 5-Retirees get bored!
Being bored and isolated is a common theme for retirees. Take Kathryn, for example, who at 67 finds herself unfulfilled as a retiree. "The kids are grown up and have left the roost," she says. "And our business has been wound down. We used to have employees and clients-it was all very exciting. Now, I don't have much of a social network because I don't have the work contacts. And we were so busy bringing up the kids and working in the business that we didn't have time to develop friendships and hobbies. My husband and I look at each other and wonder what we still have in common. For me, retirement is a big letdown."
Work also provides intellectual stimulation. Many people like to be challenged until the day they die. For these people, a golfing retirement spells despair and disappointment. These people need a challenge-and it's not going to show up on the golf course or in the movie theatre. They need to keep building. And the best way to keep building is to remain involved in their careers until they can no longer do so.
These people don't need the money for survival because they've built their wealth during their careers. What they desire is the stimulation and excitement of the workplace and the next project or client.
According to researchers, one big key to happiness is having a sense of purpose. "At work, when you know your unique contribution and how to tap into the company vision, your job can keep you happier and healthier," says Debbie Mandel, MA, stress-reduction specialist and author of Addicted to Stress.4 Another study, called The Longevity Project headed up by Edwin Shirley, Ph.D., found that when people had stressful jobs but found meaning in their work, that stress was not harmful. In fact, they seemed to thrive despite it.5 Most high-stress jobs demand productivity-and that's not a bad thing. The Longevity Project found that men and women who were continually productive on the job tended to live longer than people who were laid back and less productive. On the other hand, people who felt like their jobs didn't really matter were more likely to experience job burnout.
And there's more. Researchers from Oregon State found that...
