Employees are working longer, whether because of increasing life expectancies or lowered confidence about their ability to retire. Longer work lives are tied to less engagement and more stress, among other negative impacts. For employers, this may mean taking time to consider shifting benefits or programming to better meet changing needs both to help employees retire when they want and stay healthier if they continue working.
These changes, as detailed in "Traditional Retirement Planning isn’t Going to Cut It. Do This Instead,” in MarketWatch, mean employees are rethinking when, and how, they retire. When Social Security was established, life expectancy was around 61. Lengthy retirements weren’t in the cards for most Americans, but there was an expectation that there would be a safety net during retirement. Today Americans can expect to live longer, healthier lives. At the same time, research points to most demographic groups assuming their generation will be worse off than their parents’ generation and Social Security less available to them.
There is a bright light in the retirement conversation. With more and more people living for decades past retirement, it may be time to think not about golden years but an encore life. In this scenario, the demarcation between working and retired is less severe and more fluid. People can plan around what a thriving mature life is going to look like, and how to fund it. From career transition opportunities to civic engagement to housing to travel, retirement planning will look different for future workers.
So, how do the younger generations of workers plan for a changing, and potentially longer, work life and successful retirement during an age of insecurity? For millennials, who have many years of work and retirement ahead of them, now is the time to make fixable retirement mistakes. According to “Setting 401(k) goals: How Millennials Can Fix Retirement Investment Mistakes” in USA Today, the spending habits and assumptions about retirement programs are common, but can be overcome.
Some easy shifts, like investing with a goal in mind, taking free online fitness classes with friends instead of spending on expensive studio classes, or carrying cash to create a more tangible relationship with money can all have positive, long-term impact.