In times gone by many people had physically taxing jobs that made retiring mandatory when their body aged and their strength diminished. But in today’s world of office cubicles, often the most physically demanding work that one must do is walk to the water cooler. Therefore, the question being asked in financial planning circles is, should people automatically retire at age 67? Since there is no magic age for beginning employment, why should there be a magic age for ending employment?
Many factors should come into play when determining if, and when, to retire. Of course, one’s physical and mental abilities influence retirement age. But if you are healthy, is there a need to retire?
Like all other difficult questions, there are arguments on both sides of the coin.
Pro-retirement advocates contend that after a lifetime of giving to others, the worker is “entitled” to do what he wants. There is life beyond the demands of work, particularly if that work is neither fulfilling nor enjoyable. These folks feel that one works in order to live, and not that lives in order to work.
Pro-working advocates contend that knowledgeable and experienced workers have an advantage over younger employees, which benefits the company and society as a whole. Society has much to gain from the wisdom of experience, and early retirement eliminates many potential gains.
Continuing to work past the traditional retirement age provides intangible benefits as well as an ongoing paycheck. Staying engaged and using your skills keeps your mind sharp. While there may not be a cure for dementia, many in the medical field say that staying mentally active and challenged is as a good preventative medication as any other.
Many look forward to retirement’s life of leisure, but for some retirees, retirement turns into a life of boredom. It’s important to find activities, whether with family, volunteering, or perhaps a second career to fill empty hours with meaning. Many retirees express a feeling of loss and loneliness after leaving work. There is no reason why people shouldn’t remain productive if they are able to contribute to society.
The choice of retiring “early,” “on time,” “late,” or not at all is a personal one. If your health allows you to make a decision, choose wisely. Meet with a financial planner to see what the fiscal repercussions of retirement will be, and then make a wise decision.
Douglas Goldstein, CFP®, is the Director of Profile Investment Service, Ltd., which specializes in helping people who live in Israel with their US dollar assets and American investment and retirement accounts. He helps olim meet their financial goals through asset allocation, financial planning, and using money managers.
Published June 5, 2012.