The sky is the limit in the new definition of retirement
There is no way to write one definition describing today’s retirement. It’s traveling. It’s community volunteering. It’s starting a business. It’s a second job or working in the gig economy.
It’s all these things that throw old ideas about retirement out the window. The notion of retirement has changed. It’s no longer defined by a date or an age. It’s more of a mindset. And it’s not about leaving one’s job. It’s about planning a future and the pursuit of passions.
We asked 2,000 people ages 45-75 to tell us their expectations and realities of retirement. See the resulting report, Rethink, Rewire, Retire from the Empower Institute. Those who have retired and those who are about 10 years from retirement agreed on a key concept: It’s time to rewrite the definition of retirement.
In our survey, 83 percent of near-retirees said they expect to live their best life in retirement.
With all of the news headlines about retirement readiness, it’s easy to be intimidated by the idea of saving for retirement. Nearly 60 percent of retirees and 65 percent of near-retirees said planning for retirement feels like a full-time job and 20 percent said it seems more intimidating than skydiving.
If retirees could go back in time to give advice to their younger selves, it would be: Start saving early and don’t forget to save enough to have fun.
That’s great advice.
Optimism about the future seems to be winning over fear of planning for it. Even with the challenges and uncertainties, 67 percent of near-retirees are confident in their ability to plan for retirement. And three out of four of them are actively measuring their progress toward their goal.
In the new definition of retirement, retirees and near-retirees are overwhelmingly excited to pursue their passions and 85 percent of near-retirees say they expect to find their identities in retirement.
Both groups have great expectations about encore careers, working either fulltime or in the gig economy. Sixty-one percent of near-retirees visualize themselves working past age 66 (the age when one is eligible for full Social Security benefits). They see more opportunities to stay in the workforce in the coming years than 20 years ago.
Here in Denver, where Empower is headquartered, 20.7 percent of workers over age 65 are still part of the workforce, according to Value Penguin Inc.’s recent analysis of the U.S. workforce.
This outlook certainly has changed the definition of retirement and it has shifted how working Americans prepare for their encore act. In our survey, near-retirees say they started planning sooner than their retired counterparts. And 83 percent of them said they would rather save money today so they don’t’ have to cut back their lifestyles in retirement. They are looking forward to describing themselves as explorers, travelers and volunteers.
Who knows, maybe they’ll try skydiving.