What’s in a Word? Actually, Quite a Lot When the Word is “Retirement”

It’s well past time to discover a new way to discuss this stage of life.

In a world that’s constantly evolving, it’s crucial that our language evolves with it. Perhaps there is no better example of this than the use of the word “retirement,” which is increasingly outdated in our modern context of what this phase will be like for many. The concept of retirement, as we have traditionally known it, rarely aligns with the reality of people’s lives today.

We believe it’s time we retire the word retirement and reframe our thinking around the retirement planning aspects of what has generally been considered the post-work stage of life. In this article, we’ll address some of the reasons why retirement needs a linguistic makeover and why the concept of retirement is entirely different today than it was even a decade ago.

Is There a Disconnect?

One common concern among many financial professionals’ clients with the term “retirement” is a disconnect between how financial professionals generally think about this phase of life for their clients and how clients themselves see things. Investment professionals tend to frame retirement as a specific event marked by a fixed age and a transition from work to leisure.

They often emphasize the importance of accumulating a substantial nest egg, focusing on financial preparedness and investment strategies to ensure a comfortable retirement. And it is only natural that many approach retirement planning for their clients as largely a financial exercise.

However, for most clients, retirement is not an event but a process. It’s a dynamic phase marked by transitions, new beginnings, and continuing personal growth.  Clients may have diverse aspirations for this phase, ranging from starting a second career to pursuing long-held passions, traveling, or spending more time with family. Their financial needs and goals in retirement are equally diverse and often go beyond the traditional idea of simply maintaining a comfortable lifestyle.

This disconnect between the perspectives of some financial professionals and their clients suggests it’s time to rethink and rephrase our approach to this life stage. The word retirement implies an endpoint, while for most people, it’s actually about a state of exploration and new experiences.

Retirement: Then and Now

To appreciate the need for reimagining retirement, let’s examine how it has transformed in the past decade:

  1. Longer Lifespans: Life expectancy has increased significantly over the last century. People are living healthier and longer lives, which means retirement could span several decades. The traditional concept of saving enough to last for a few decades after retirement no longer suffices.
  2. Evolving Work Patterns: The gig economy, remote work, and flexible employment options have altered the way people engage with work. Many retirees are choosing to continue working or consulting in their field, either for financial reasons or simply to stay engaged.
  3. Changing Financial Realities: The economic landscape has shifted, and traditional sources of retirement income, such as company pensions, have become increasingly rare. Individuals are now tasked with managing their retirement savings, which often leads to complex retirement planning challenges.
  4. Shifting Priorities: The traditional notion of retirement, marked by a sedentary life, no longer appeals to many. Active lifestyles and personal fulfillment take precedence. People are seeking experiences and adventures, not just a comfortable chair and a pension.
  5. Health and Wellness Focus: The importance of maintaining physical and mental well-being has become more prominent. Retirement today often involves a renewed commitment to health and fitness, leading to an active and fulfilling life.

Given these shifts, the word “retirement” no longer encapsulates the diversity and dynamism of this life stage. A more flexible and inclusive term is needed to capture the myriad ways people now engage with their post-career years. We like the word discovery. Think about that for a minute. What comes to mind when you see that word? Consider this:

According to Merriam-Webster, synonyms for retirement include:

pullout        retreat          pullback     put out of use     withdraw   recede

Whereas Merriam-Webster’s synonyms and similar words for discovery are:

reveal           create           explore        invent          detect          breakthrough    

Given the choice of using retirement or discovery when speaking to your clients, which do you think would lead to a more positive and fruitful conversation?

A Final word

To align with the contemporary reality of retirement, you may find it helpful to reframe how you address retirement planning and the range of natural life transitions your clients will encounter. Retirement planning for this stage of life is as much about what your clients hope to do as it is about how they’ll pay for it.

Retirement doesn’t necessarily mean a life of complete leisure. In fact, studies consistently show that those who stay engaged, whether through work or social activities, tend to be the happiest in their golden years.

According to a report by the American Psychological Association, retirees who remain socially connected have a significantly reduced risk of depression and cognitive decline. This is reinforced by data from the National Institute on Aging, which found that older adults who engage in part-time or volunteer work report higher levels of life satisfaction and well-being. Furthermore, the Harvard School of Public Health discovered that working part-time in retirement can lead to a 25% lower risk of heart disease compared to those who fully retire.

Maintaining professional involvement can be equally beneficial. The Brookings Institute reports that research from a Gallup World Poll found

a “happiness premium” among older workers working full-time or voluntarily employed part-time. And late-life workers (i.e., those working past retirement age) working full-time or voluntarily employed part-time were typically happier and more satisfied with their health than their retired counterparts.

Working not only offers a source of income but also provides a sense of purpose, continued skill development, and a way to stay connected to one’s industry. In essence, remaining active and engaged in retirement isn’t just financially savvy – it’s also a key to lasting happiness and well-being. So the next time you’re scheduled to have a “retirement” conversation with a client, try this for a change:

“Hello Steve, let’s talk about the things you intend to pursue during your years of discovery . . .”

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