Is the concept of retirement as we know it dead? What does the future of retirement look like for our generation and those who will come after us?
This is a fundamental question to answer, not only for your personal and professional life but for the lives of your employees.
By peering into the future of retirement and thinking about changing retirement trends, you can better plan your future and help your team do the same.
In this blog, I’m answering the all-important question, “is retirement dead” and helpfbing you understand the current retirement landscape. But first, let’s get started with a little history lesson!
What is the history of retirement?
Before we can think about the future of retirement, we must take a look at the history of retirement. So, where did the concept of retirement even come from, and how has it evolved into the retirement we know today?
It all began with German Chancellor Otto Von Bismarck
You see, our good old friend Otto had a problem: In the late 1800s, he had a bunch of young unemployed Marxists to contend with in his country of Germany.
Otto realized that the best way to get these youths INTO the workforce was by getting the older folks OUT of the workforce.
So he created a type of social security system where people aged 70 and older were pushed out of the workforce and paid to stay home.
Other countries figured he was onto something
Think about it, the vast majority of employment in the 1800s and early 1900s was factory work. The workforce was made up of blue-collar workers using their hands and physical energy to create things we needed to operate the world.
So in countries like America, where we had all these older people working in factories who were getting paid more every year, replacing them with younger people who could physically work twice as hard (for less pay) seemed like a no-brainer!
And so came the Social Security Act in 1935
Now, the thing with the social security act is that when it was first introduced in 1935, the retirement age was age 65. Here’s the kicker: The life expectancy at the time was 58.
Yep, you’re right. That meant that most people never got social security because they had already died by then! Grim, I know.
Relative to today, this would mean our retirement age would kick in at age 85 or 90! So what happened between the original concept of social security and pensions to bring us to where we are today?
The 1960s glamorized retirement
When we get to the 1960s, the original pensions used to get older people out of the workforce were working; however, the life expectancy age had increased considerably to 69 thanks to innovations in healthcare and working environments.
So, smart companies (aka the financial services industry) started glamorizing the possibility of a leisurely retirement.
They said, “Instead of taking your pension and dying, what if you worked towards your pension and spent the following years in leisure playing golf and drinking sweet margaritas on a beach somewhere in the Caribbean? How great would that be?”
This was the first generation of workers to be fed the idea of building a retirement nest egg. The idea was that you’d spend your time working hard to make the nest egg, so you can get to a point where you stop working and ride off into the sunset. Interesting right?
But retirement didn’t work like this for everyone
The thing is, most people that were fed the idea of a beautiful, relaxing retirement didn’t actually see this dream come to life. Either they couldn’t retire when they wanted, couldn’t retire at all, or died first. It’s sad, but that’s just the way the world works.
What the future of retirement holds
There’s a very specific reason I asked, “is retirement dead,” at the beginning of this blog.
I’ve found that the more time I spend talking to other entrepreneurs and professionals and asking, “do you plan to retire,” the answer isn’t just no; it’s “hell no, I don’t ever plan to retire!”
This is what led me to ponder what the future of retirement looks like. Here’s what I know.
Creating long-term value
Now that we are becoming wise to the fact that most retirements don’t work out as planned, we’re not looking at retirement as the end goal.
As humans, we desire to create value, to create impact, and not simply consume the resources that exist in the world. We want to do something meaningful with our lives.
We no longer want to sacrifice our young, healthy years working extra hours, giving up free time, and having no freedom from work just to finally be able to relax when we’re much older – when our bodies may not allow us to live a healthy life.
That just doesn’t make sense, does it?
Still with me and want to learn more? Check out my other blog, “Using The Four Seasons Mindset For Dental Practice Success.”
Spending quality time with family
What about the concept of raising families? The idea of sacrificing precious time with your kids so you can work your butt off to enjoy a nice retirement just doesn’t fly with people anymore.
Ever heard someone complain about our future generations or say kids don’t do anything meaningful? Maybe that’s because they didn’t invest in their kids to nurture them, guide them, and give them value because they gave that value to their work instead.
Championing financial independence
You know something I hear more and more in our young population of entrepreneurs and professionals? They don’t like the term “retirement,” but they love the term “financial independence.”
Financial independence is at the core of what the future of retirement looks like. It means people don’t have to work; they choose to work. Financial independence gives them enough financial freedom so they can view work as an option, not a necessity.
And you know what’s really cool about financial independence? It allows the workforce to focus on what brings them the greatest joy and provides the most significant value to society.
Think about it: how much better would our world be if people could do their most valuable things?
Valuing years of knowledge
Humans are like fine wine; they get better with age.
Don’t believe me? Do you want Warren Buffet’s knowledge and experience at the age of 20 or 70? I’ll take him at 70 any day of the week!
And yet, the concept of retirement says when we get older, wiser, and have incredible knowledge, we don’t use it. Instead, we drink margaritas on the beach.
Let me tell you, the only value that offers is to the barman in the beach hut. The future of “retirement” looks less like an end, and more like a new beginning. Less “slow down”, and more “double down.”
Why the death of retirement isn’t a bad thing
Many studies have shown that once we stop living our purpose, we begin to shut down. We die earlier and tend to suffer more health issues.
Think about football coaches like Bear Bryant, who died shortly after he stopped coaching. Unfortunately, there are many other coaches with stories just like him.
While I think the concept of retirement will never completely die, it’s definitely on the way out. And you know who is pushing that? Our post-millennial professionals…the ones who are making it rain!
They’re calling out the failed promise of retirement and deciding to play the long game so they can live their dream lives NOW, not when they’re too old to enjoy their freedom.
And I think it’s pretty awesome! Now, what do you think? Do you think retirement is dead? Are you seeing this trend as much as I am? I’d love to hear your comments and thoughts.
If you want expert guidance to find financial freedom and live a healthier life professionally and personally; speak to me.
I’m Dr. Eric J Roman, your heart-centered mentor inspiring change and manifesting impact to help you create a better future for your dental practice and the dental industry at large.
Ready for stronger teams, happier patients, and surging growth?