Here’s what to know.
Experts in This Article
Demelza Campbell is the owner of financial consulting business Parental Wealth.
Jean Accius is the senior vice president of global thought leadership at the AARP.
Retiring in and of itself is a massive privilege.
Older generations used to stay at their jobs for their entire careers…
Meaning that the burden of saving for ones golden years falls entirely on the individual.
Demelza Campbell is the owner of financial consulting business Parental Wealth.
Its this idea that look, its super easy, just push this button, when its really not.
Similarly, the current inflation rate, now at roughly 9.1 percent, is thelargest annual increase since 1981.
As for Social Security?
New retirees may have a hard time accessing this money at all.
And the notion ofearly retirementmay become akin to an urban legend or a financial fairy tale.
But whether it is a realistic antidote to traditional retirement remains unclear.
Is it an opportunity for those wanting to live longer, more fulfilling lives?
Theres no easy answer, says Manent.
Theres no one way this goes.
Demelza Campbell is the owner of financial consulting business Parental Wealth.
Instead, she says, many clients want to be working in a different way.
Its not, I dont want to work.
Its, I dont want to do that kind of work, she says.
People have had time to think about what they want to do with their life.
What brings them meaning?
How do they prepare for their own health and financial resilience, particularly as they age?
What has followed is a reexamination of what the future of work, and thus retirement, looks like.
Were seeing people who are going back to school or getting a certificate, Accius says.
Companies are upscaling and rescaling to provide new avenues for growth.
Were seeing fellowships and reverse mentorships.
Theres a lot more movement and flexibility at play here.
The Limitations of Pretirement
However, some experts are skeptical of pretirements empowering framing.
There was always another job, another hustle, another opportunity to generate money for their families.
My father retired from a full-time position, and now he has two part-time jobs.
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Theres a possibility you might live until 100 years old.
Are you prepared to save enough for all those additional years?
Unexpected illness or disability might also make it harder for a person to work, or limit their options.
And thats not necessarily the worst thing in the world for many people.
Being forced to work indefinitely, Campbell says, is not ideal.
But if continually earning money provides the ability to make decisions, theres opportunity there.
Its about making the choices you want to make and not the choices you have to make.
Heres what our experts recommend:
1.
But she doesnt only mean actual dollars in the bank.
Ortega adds that people appreciate this now more than ever.
They realize how important anemergency savings accountis because COVID came and everyones [investments] got blasted.
Can you practice living like this for 6 months?
What does that look like?
There are a few freebudget calculator toolsonline to help make this easier.
Invest in your future… Keep an eye on it, and toggle the risk over time, Ortega says.
…and shorter-term goals
Use different investment accounts for different needs.
This makes it hard for older adults to keep existing jobs or find new ones.
Companies must add age as part of their Diversity, Equity & Inclusion policies, Accius advises.
The workforce is getting older, but so is the consumer base.
Addressing systemic issues in their workplace spills over into the communities in which their workers live.
Consider caregiving costs
One of the single greatest risks to your long-term financial security iscaregiving.
Despite more than48 million people acting as unpaid caregiversin the U.S. today, its often an unexpected burden.
Then its their health care, their security.
And then your parents get older.
Whos going to take care of them?
People need to be realistic, she says.
Its going to get harder and harder.
I tell younger clients to save more than they think.
If you want to have a life that you really want, build it on your own.
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