What is the new journey of retirement?
We know that it doesn’t look the way it did even 20 years ago. Retirement, how people spend their time once they’re retired, and who can be classified as a “retiree” have all shifted significantly in the 21st century.
On Creating Your Encore Career, I looked into a report on this topic. The report was done by Edward Jones and The Age Wave Institute and is called, “Longevity and the New Journey of Retirement.”
They performed a study of more than 11,000 North American adults, largely pre-retirees and retirees. Their purpose was, “To explore how the journey of retirement unfolds, the patterns of people’s experience in retirement, and the keys to thriving along the way.”
The Purpose of Retirement
One of the questions they asked participants in this study was what they consider to be the purpose of retirement. For the parents of today’s retirees, the focus of retirement was mostly on “rest and relaxation.” Now, the majority of retirees view retirement as “a new chapter in life.”
Here are the results from the report:
Retirement is now a new chapter in life - 55%
A time for rest and relaxation - 22%
A continuation of what life was - 15%
The beginning of the end - 8%
The New Retirement
Clearly, the retirement journey has changed considerably. Major forces are contributing to this and reshaping the new retirement and the lives of retirees. They include:
The longevity revolution
The global aging boom
The lifespan-healthspan gap
The demise of the three-legged stool for funding retirement
The COVID-19 pandemic
Now, four stages make up the new journey of retirement. These 4 stages are as follows.
Stage 1: Anticipation (< 10 years before retirement)
Stage 2: Liberation/Disorientation (0-2 years after retirement)
Stage 3: Reinvention (3–14 years into retirement)
Stage 4: Reflection/Resolution (15+ years after retirement)
How to Thrive in Retirement
The study also set out to find what qualities make retirees most likely to succeed. Findings displayed four distinct groups of retirees.
1. Purposeful Pathfinders: the most active, engaged, and fulfilled of the groups. They have prepared well for retirement and began saving the earliest of the groups, at age 34 on average.
2. Relaxed Traditionalists: pursue a more traditional retirement, focused on resting and relaxing. They have prepared well financially and are enjoying life for the most part.
3. Challenged Yet Hopefuls: make the most of retirement despite a lack of planning and saving earlier in life. They feel satisfied with today but challenges lie ahead.
4. Regretful Strugglers: enjoy retirement least of all and tend to be struggling with financial and health problems.
From there, the study concluded that there are five habits that, if practiced, make someone likely to be a very successful retiree and to thrive in this season of life. These five habits are:
1. They attend to their health.
2. They stay socially engaged.
3. They have a clearer sense of purpose.
4. They mindfully manage their finances and keep them on track.
5. They are willing to course correct again and again to achieve their retirement dreams.
