by Tony Kippins
I get to read a lot of white papers, research documents and editorial opinions about retirement—it’s part of my job. And it seems to me that retirement is easy to define until one tries to define it for research purposes. It’s been clear to me for some time now that retirement can take many different forms, and what defines retirement for one person does not define it for another.
I read an article recently in the financial press that assumed that because the majority of American retirees were working for pay—often referred to as “bridge employment”—they could no longer afford to retire. It makes a great headline, but maybe a closer truth could be that when our full time job/career no longer needs us or no longer feeds us, we’re just not ready to… well… go!
The death of the defined benefit retirement system has, in many respects, given us all a lot to think about. We can now blend part-time earnings together with social security and our savings to leave the full time workforce much earlier than previous generations. Married couples who are both in the workforce can choose to coordinate their retirement dates in order to pursue other interests. The life style variables are endless! Of course there’s a difference between wanting to work and having to work, and our individual health status and debt ratios will play a role in this, but the day of the gold watch and rocking chair at some arbitrary age are pretty much over.
We do, however, need a plan: one that considers our sense of purpose, time and social perspective as much as the financial considerations. We probably need a little time to get used to our new retired life, a kind of practice time. We probably want to test our spending habits and examine the tax implications of our decisions, too. It seems to me that bridge employment is not just an interesting phenomenon but a sign that retirees are figuring out how to maximize their opportunities, leverage their retirement savings and find more time for the things that are important to them without a drastic drop in disposable income. Not a bad idea and a pretty good plan!