You can retire from a job. But can you retire from life? Is the idea of retirement part of the idea of the job?
If this is correct, then as fewer and fewer of us have jobs, then the idea of spending the age of 65 - 85 playing golf has to go away. As does the idea of us old folks living separate lives.
With low relative wages over the last 20 years, the saving base is not here anyway. 75% of American nearing retirement age in 2010 have less than $30,000 in savings. Most have no pensions in the old way of a predictable annual flow of money either. And even these, mainly in government, are under threat as many are underfunded. Many pensions have lost a lot of ground in the last 10 years as well. With very low interest rates, even people who have savings are earning next to no income. Government bonds pay less that 1.5%. This will force savers into capital.
This thoughtful piece got me thinking more about this today.
"As with many concepts that we now take for granted as a reality seemingly dictated by the laws of physics, the idea of retirement is a social construction that is subject to change. A combination of factors now challenge today’s notion of retirement. The changing nature of work, economic necessity, smaller and fragmented families, the capacity of public and private pension providers to ensure income that enables 20-plus years of not working for income as well as the desire of many retirement age people to continue working are eroding our expectations of what retirement is and should be. Sometimes big change happens slowly and is barely perceptible at any one moment. Retirement, as we know it today, is history. A new story is emerging – a narrative that will change how we individually plan and behave as well as the government and business institutions that are built to support the retirement we once knew."
I struggle to make sense of this for myself. I have savings but next to no pension. My savings would have been enough in times when interest rates were higher but not now. This is why I have downsized my own life and invested in ways of reducing my costs in the future. This is why I have become so interested in staying healthy. This is why I have started to reconnect with the daily lives of my kids and their kids.
Are you a boomer? How do you see the next 20 years? Do you have some good ideas to add to the mix. I don't think any of us on our own are smart enough to figure this out. But maybe we can collectively muddle our way ahead through trial and error?