Retirement Reset in Chicago

Prior to the 1930s, for all intents and purposes, retirement didn’t exist, according to Ken Dychtwals. “The word wasn’t used in modern language; you can’t find the word in books. The general idea was that people worked throughout their days. They earned a livelihood, had a feeling of self-worth (a non-trivial piece of the puzzle) and work acted as a social connector.”

Yet something happened in the mid-1930s according to an article at RetirementReset. People think Social Security was crafted in order to give older adults a comfortable passage. Not so, he says. “The larger part was that the unemployment levels reached 25%, which presented an interesting challenge. If young men and women can’t get jobs, the entire ‘American engine’ stalls. They don’t have kids, buy houses and cars and generally don’t consume.”

Social Security provided assurance, at least in part, for retirement and therefore allowed them to rev the engine. This generation worked and saved and had a bit of rest toward the end of their lives, resulting in a period between 1935 and 1975 that Dychtwald calls Retirement 1.0.

“In the 1970s, however, retirement morphed for a number of interesting reasons,” he says. “One of them was that people began to get wind of the idea that longevity was on the increase. The other thing that happened was that the financial circumstances of older adults completely reversed. It used to be the highest poverty levels in America were among the elderly. By the 1970s, the elderly had the lowest poverty levels in America.”

• Today, 54% view retirement as a new chapter in life, rather than a winding down—a significant increase over the 38% that held a similar view a decade ago.
• However, retirement is being postponed: Pre-retirees say they now intend to delay retirement by five years—from 64 to 69—triggered in part by increasing longevity, as well as the recession and financial need.
• Retirement no longer means the end of work: Almost two-thirds say they would ideally like to remain productive and include some work in retirement to stay active and involved.
• Financial peace of mind is now six times more important than accumulating wealth: 82% name it their key financial goal.