Is Retirement Realistic for Today's Workforce?
The term retirement has meant different things over the decades. Your grandparents interpreted retirement as a time in which they quit working entirely, and began to claim their pension and government-funded retirement programs. A pension or retirement fund was a reward program that most companies made available to their employees who had worked loyally for several decades.
Our grandparent's generation would have started working full-time jobs in their late teens and early twenties and stayed with one company for 30-40 years. Most people could expect to live a decent standard of life using this money, plus some savings, and if your house was paid off around the time you retire, then you were all set. Unfortunately, this is not the case today.
What is Different Today?
Today, very few companies offer traditional retirement plans or pensions. Those who do, offer them at a drastically reduced amount compared to the cost of living. Today, retirement is the responsibility of each individual person. People are expected to save up for their own retirement. Another factor that plays into retirement planning is the fact that people have a longer life span now than they did during our grandparent's day or great grandparent's day. Not only is the responsibility of retirement your responsibility, but you need to plan for longer stretches of time.
What People Are Doing Today
Today, many people are discovering two things about retirement. First, they are discovering that savings and keeping a moderate standard of living are crucial in order to be able to plan for a decent retirement. The second thing they are discovering is that the definition of retirement is changing. For many people, retirement no longer means that you will simply stop working. For many people, this means that they will stop working full time. Many people like to use their later years to explore other job interests part-time, start a business or monetize a hobby.
Reevaluating the way you view retirement is crucial to your long term success and happiness. Although things are changing, these changes are not necessarily bad. It is important to look ahead and have a retirement plan in place.