Terms and words adapt and evolve, including “retirement.” But that shouldn’t be interpreted to mean that financial planning for retirement is also obsolete, argues a recent column.
In “Why You Don’t Want to Retire Retirement Planning,” a piece appearing in Forbes, researcher Bob Carlson writes that “financial advisors, social scientists and media figures” are among those who say that the concept of retirement —and preparing for — should be retired.
Why? Carlson attributes this argument to a variety of factors, including increases in:
- longevity;
- active, rather than sedentary, lifestyles later in life;
- working past age 65; and
- retirements that begin after age 70.
Carlson asserts that these trends will not change any time soon because of today’s healthier lifestyles and improvements in medicine and nutrition. He adds that it is easier for people to work later in life due to the continuing rise of “knowledge work.”
But Don’t Stop Planning
Carlson concedes that “those all are good points,” but argues that “they don’t mean retirement is obsolete and people shouldn’t plan for retirement.”
Why? For one thing, Carlson says, despite the factors that all militate toward working longer, “most people still retire from specific careers at some point and eventually from all paid work.” In addition, he says, working beyond the traditional retirement age doesn’t necessarily mean working in the sense that it did at younger ages; it can mean working, but fewer hours and lower pay, or as an unpaid volunteer. “There is indeed another phase of life when most of us still will be more productive and active than previous generations were. But many people prefer to channel that energy into activities other than work. And almost everyone wants to retire at some point,” he writes.
Another reason that retirement planning should not go away, Carlson suggests, is that there also are people who retire sooner than they anticipated. Not only that, says Carlson, eventually no matter how financially secure one is, one will have to contend with age-based financial issues and money management.
“What we really mean by retirement,” writes Carlson, “is most of us at some point want to have enough resources that we no longer need to work for compensation if we don’t want to.” Planning is necessary in order to reach the point at which one can have sufficient financial security and independence in order to be able to retire in some manner and pursue what one wants, he says, adding that “it will resemble current retirement planning.”
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