Continuing with my
buddy friend over at the Canadian Capitalist asked the lyrical question about whether when the baby boomers retire, will it cause the financial markets to crash because they will all be sucking their money out of them to live on.
That’s a good question, but here is a better question, are we actually going to retire?
The Baby Boomer generation and the generation before it may well be the only two generations to retire. My Dad retired, but before that most people died before they reached retirement age (two world wars does put a damper on planning for the future). All these baby boomers have all this money put away (or do they? we’ll only know in a few more years) and think they will retire.
I am a little more pragmatic, will I retire? I have dreams of retiring now while I can really enjoy things, but will I have enough money to retire at 65? Will CPP exist then? Will my pension from my employer still be solvent? (remember I wrote this while I still worked at Nortel) Will my debts be low enough that I can retire? Will I be doing something by then that I want to STOP doing? All very good questions to think about.
Will You Ever Retire ?
Don’t assume you will retire, but plan like you want to is all the advice I can give right now.
Given I have a safer pension, retirement is much more of a reality now, but retirement is still more of a dream than a reality for me right now.
Retirement is a concept that has only really been around for 75 years. Before that you simply got sick and died on the job, or plowing the fields. Will the Millenials ever retire? I doubt it, but they will live a lot longer too, which will make for an interesting financial equation.
Whether you retire or not, you want to have a choice. I will never retire or at least not in the traditional way. When I achieved financial independence, I went out and started businesses because I enjoyed what I was doing. When I “retire” again I expect to do a variety of things to keep me busy.
But are you sure your retirement is going to be as long as you hoped ? Will you be mobile and able to enjoy it? What happens when things start to break down ?
I guess I’ve always had a slightly skewed perspective based on my parents and my inlaw parents: I’ve always assumed that retirement was something that was DONE to you. Both Dads and two GrandDads were forcibly early retired. Basically your boss and HR walk into your office and say “You’ve got two choices: take this lousy early retirement package, or get fired.” What choice is that? My Mom and one GrandDad had “mandatory retirement.” For those young uns reading this, yes, the government used to force you to stop working at 65 whether you could afford it or not. (Unless of course you were a politician or a senator.)
What I learned from all of them is (a) save like the Dickens (b) be prepared to invent yourself a new career at any time. All but one of the ones forced out the door went on to continue working in totally different ways. (Pottery, fine woodworking, carpentry, investing, antique re-selling, etc. etc.) The good thing about these forced choices was they found a great deal of personal satisfaction in their later years and still do.
Will I be financially ready to retire when the time comes? Who knows. Do I know it could happen anytime whether I want it to or not? Yes. I already have some creative career possibilities in mind!