Retirement isn't for everyone

THE REICH REPORT

Coming from someone who's expertise is in retirement, this might not seem like an article you'd get from me, but the reality is that for some people, retirement simply isn't the goal. For others, it may be a retirement from their normal 9 to 5 job only to "retire" to a new job that typically involves something that they are very passionate about.

Ironically, I fall into the category of people who don't want to retire. I view helping people better understand the world of finance and investments in order to improve their lives as my calling, and I couldn't imagine not doing it. While I might not keep up the same pace forever, I can certainly see myself working for most of the rest of my life doing a job I love.

Retirement today isn't what it was back in the early part of the 20th century. Retirement for many was necessitated by the physical difficulty of industrial factory work. Some jobs your body can only do for so long. Social Security was started in 1935 as a means for those to retire comfortably during that time period. Today, our economy is far more service based than manufacturing like it was back then.

Many people are simply physically able to work longer, as a result, than those in previous generations. Add in the fact that life expectancies have increased and it's not hard to see why many people choose to retire later in life. Of course, finances play a big part in that decision too. In 1935 when you could collect Social Security at age 65, the average life expectancy was 64.9 years. It's not hard to see why they never thought Social Security would run out of money given those statistics.

There wasn't a huge need for long-term savings for many people since they typically only lived a few years in retirement. Today retirements can last 30 to 40 years.

I sometimes feel clients get relieved when they realize that their thoughts of not wanting to retire are perfectly normal. Studies show that not everything about retirement is great. Retirees can feel a loss of identity after years of work. If I'm not an "X" then who am I? Retirees can have higher rates of depression, substance abuse and reduced social interactions when compared with non-retirees. This isn't to say that it happens to all retirees, but it is certainly more common.

So, what do you do if you think traditional retirement might not be right for you? For starters, assuming you are looking to change careers, make sure you are in a financial position to retire. Once you know you can pay all of your expenses regardless of what you earn in your "next act" you can approach it with less stress.

This way, you won't be reliant on making a certain amount of income or feel pressured to do so in your new venture. You most likely want this new phase of your life to be something you're passionate about and not worrying about the stress of making a living from it.

Next, set realistic expectations of yourself and your time. As we age, we can't always keep up the same pace we did in our 30s. At least I know I can't. Instead of jumping back in 40+ hours a week, start off part time and if you so choose, then add hours from there. I find some clients work more than ever in their new venture simply because they are so passionate about it, and it doesn't feel like work to them.

Either way, by starting part time, you can get a sense of what working less is like. Does it agree with you or not? I would say half of the people I meet decide they enjoy the time off and soon stop all together and the other half really enjoy their "new life" and pursue it full time.

Whether or not you think retirement might be a good fit for you, start planning today for what that time in your life might look like. As planners it's our job to help you work through those decisions. Regardless of which way you are leaning, by thinking about these decisions today you can take a lot of the stress and anxiety surrounding retirement off your plate. After all, the whole point of retirement is that it is supposed to be enjoyable.