Retirement Taking on a Cyclical Pattern Today

According to a recent piece in Financial Advisor Magazine, the model of retirement to which we've all grown accustomed will soon go the way of the dodo thanks to a number of unseen forces over which we have no control.

The model of retirement that came about in the 1940s and 1950s looked like this: retire at 62 and receive a gold watch, a pension, and a Social Security check. Today's model varies from that for a good reason and a bad reason. The good reason is that people are living longer than they ever have, with the average life expectancy for a man in good health at age 65 now at 86.6 years and 88.8 years for a woman. This means, though, that people must postpone their retirement dates in order to have the funds needed to support themselves into their longer lifespans.

The bad reason is that automation is destroying traditional jobs, with one University of Oxford study predicting that half of today's occupations will be displaced by automation in the next decade or two. This means that individuals' work lives will out of necessity take on a cyclical character: as careers become obsolete, new skills must be learned and new occupations must be taken on. People can expect to be in and out of the workforce for much of their lives and as a result will have to retire later in life.

The author of the article managed to express this rather grim news pretty cheerily when he reached this conclusion: financial planners should expand their traditional areas of expertise--saving for college for children, buying houses, handling insurance needs, etc.--to include a form of retirement planning which will help their clients "thrive in their new cyclic lifelines."