Saturday, November 05, 2005

Retirement?

No, not mine. In fact, I can't see myself ever "retiring" in the traditional sense. Slow down, yes, but what I don't really understand is our culture's fascination with "retirement".

Let's face it, most people who retire are not flush with enough cash to travel the world year round and enjoy the finer things in life all of the time. In fact, most (yes, most, not all, most) people I know who are retired or close to it are constantly looking for ways to scale back. I am not talking about people who spent their lives working as assembly line workers or mid level management at some faceless corporation/government department, because they usually have(or at least had pensions a la Enron). I am talking about the well paid professional/bureaucrats who may still own a cottage or a condo in a warmer climate who probably don't have enough saved to maintain their current lifestyle (part of the problems with this group of people is that they think they deserve a certain lifestyle, regardless of if they have earned it........they should try owning/running a business......you learn how to stretch a dollar pretty quick)

What brings the topic of retirement to mind is the fact that the Globe and Mail runs a weekly personal finance article on the topic of retirement/personal financial planning in which they dissect the financial situation of a couple/person and how they are/aren't accomplishing their retirement savings goals and if they don't get their house in order soon, they are going to end up whittling their golden years away working as a Walmart greeter.

My question is, who wants to retire? I get antsy spending a day at home if I am sick. My grandfather hasn't worked worked for 30 years. He had heart surgery in the early 70's and the prevailing logic at the time was that if you have heart problems, you have to take it easy for the rest of you life. Let me tell you, if you think running a business is hard on a marriage, try 30 years of retirement.

So what is my point? We besides saying that marriage is always hard (which it isn't really), I think that the concept of "retirement" is outdated and misguided.

1 Comments:

Anonymous Daniel Nerezov said...

Very important topic.

Josh, Governments too share your perspective that the concept of "retirement" is outdated and misguided. If they haven't already, in the near future I'd expect the Canadian legislators to push up the retirement age well above 60, and offer incentives for people to remain in part-time employment.

People working longer and retiring later in life, is colloquially called the forth pillar of retirement financing. The situation, of course, is really screwed up not only with the forth pillar but all of them; the aged pension, compulsory retirement savings and voluntary retirement savings. The economic modelling on this issue is actually pretty uniform across coutries with most retirees project to suffer from a severe decline in lifestyle as they leave the workforce.

Interestingly, the ones who exprience the sharpest drop in standard of living are those who were relatively wealthy durung pre retirement (their lifestyle has a lot of room to fall). For example, a couple, without children can experience a drop in lifestyle of up to 70% as both of them leave the workforce. The decline is less severe for sigle people, or those with children - but nevertheless, the retirement problem is very severe not only for the retirees, but the Government which has to provide for this aging population, and the rest of the tax payers who have to finance people living in retirement.

But back to your question...why on earth would you want to retire? Aside from any medical conditions that force people to call it quits...I can tell you that there is a lot of retirees out there who could be working but choose not to because they want to claim the aged pension. It becomes like a moral quest....that they've worked all these years, paid the taxes and now they must retire to claim their entitlement. Sad, but true.

11:31 PM  

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