Is retirement an antiquated idea? Should it go away like the horse and buggy did a century ago? If not, what new experiences and possibilities should professionals think about as they enter the latter years of their working careers?
I think about these questions frequently, because the primary focus of my wealth management practice has been serving professionals who are in between jobs and considering these very issues (or have done so in the past). I have met and counseled hundreds of people over the years and have observed that this moment is a uniquely important transitional point.
For many, the questions are not necessarily about whether they have the financial means to retire. Between Social Security, retirement savings, and home equity, many people actually have more than adequate financial resources to confidently leave the world of work.
Instead, there are different questions and issues than the financial considerations we often think about when it comes to retirement. Don’t misunderstand me – personal financial planning is certainly important at this life stage. But what may be equally significant is giving yourself the time to understand what lifestyle will create deep happiness in your next life chapter.
Can You Feel Calm and Serene After Job Loss?
You may be in transition or have lost a job during this pandemic. However, this might not be the time to go “all out” to find that next job, as you might have done in the past. This may apply to you if you have been a diligent saver over the years. You may not feel the financial pressure to immediately jump back into work or a new position. In fact, you might even feel very calm about your situation.
Although I certainly recognize the challenges in today’s weak economy, my opinions and observations are not framed by a pessimistic outlook for job seekers. Many who have had steady and successful work histories over the years are likely very employable, even in today’s difficult job market.
What makes mid-life career transition different is that it is often a “fork in the road” moment. And it is natural to have mixed feelings about both retiring AND going back to work.
Going back to work might entail trade offs that are unacceptable – long commutes, long hours, corporate priorities that go against your professional (or personal) beliefs, and yes – ageism. You might still very much enjoy the idea of continuing to work, but not under the “new world” order that has taken effect over the past decade or so.
At the same time, retirement may not look like a bed of roses, even if you have the financial means to stop working. Contrary to financial/investment company TV ads, some people find the idea of endless golf, travel, or other leisurely pursuits to be boring, unfulfilling or both!
You may be one of those individuals who still has the interest and energy to leverage the skills and experience you have developed over the years. But you might only choose to work if you can do so in a different setting and/or in a different way such as the gig economy. And contrary to media portrayals, the gig economy often includes other options than driving for Uber or earning income from some other digital platform.
Enter Stage Right: Your Next Gig Could Include a Working Retirement
Many people work in their so-called retirement years, and in a surprisingly large percentage in instances, these choices are not because they are financially unable to stop working. Lifespans are longer and attitudes about midlife work are different than in the past.
There are many examples of professionals working independently and using their skills to deliver a service valued by consumers or businesses. In fact, according to a 2016 research report published by the McKinsey Global Institute, 20% to 30% of the working age population in the US and the European Union – or approximately 162 million people – are engaged in independent work. Of these individuals, McKinsey estimates that only 15% of them earn income through digital platforms (like Uber), though they noted that the growth rate in this segment is very high.
Interestingly, McKinsey’s research showed that a significant percentage of independent workers derive higher levels of satisfaction than those working in traditional employment by choice.
Consequently, independent work may be a good choice for those midlife professionals who may want to continue working, especially if the motivation to continue work is not due to financial needs. Independent work may be especially ideal for those seeking the freedom to work in a way that is more closely aligned to their business beliefs/philosophies and personal values.
There is no “right” or “wrong” answer to the provocative questions posed at the beginning of this post. The traditional idea of retirement may still work for many professionals, as does continuing to work during what many would consider retirement years. The best choice is the one which ultimately works for you and your family.
But the process of getting to that answer may not be quick and may also involve thinking through a number of financial considerations. That will be the subject of my next blog – until then, let’s all stay healthy and safe!
