The Long Goodbye: Delaying Retirement, Working Forever, and Life Insurance in a Postmodern World

The Long Goodbye: Delaying Retirement, Working Forever, and Life Insurance in a Postmodern World

Memo to management: I intend to perish at my desk. Request extra vigilance from cleaning staff.

Old dad would have thought I was nuts. After nearly four decades with the same old company, he looked forward to restful retirement – ease, at last. Just as he hit the limit – 65 in those days; no exceptions – a family tragedy forced him to step up. His grandchild needed a father figure – read: a tutor, a chauffeur, a curveball hitting coach, a financial backer, and infinitely on – so lazing under the pines clicked to ‘hold’. 

My mother, who could rattle the windows with her corrective invective “Alec!”, secretly called the old man “the Rock of Gibraltar.” It wasn’t the result he hankered after, but he did what we do for our families, for crying out loud. Like he wants a medal? That’s how it runs: things happen, plans change.

Take this coronavirus now. A study says that 29% of Americans will retire later than planned in the roaring wake of the pan-oceanic pandemic. Three years’ delay is the average reported – a long time, nose to the stone. Many spent savings in this parlous year of lockdown: 25% say the pandemic harmed their finances significantly, and the young were hit harder than anyone – naturally, as they started out with less.

Ten percent say they will retire early – a curious thing, when everyone is being told to work longer, build up savings, maximize Social Security, let their investments compound. Maybe this rebellious minority sees life as too precious to waste – live today, maybe with less; enjoy those cool pines, perhaps. Some may simply be sick of the chase, taught the hard way to relax, and they like it.

Some are left seasick with doubt. Consider this factor my old man had never considered: retirees with burdensome debt. It’s a real heart-stopper. Many seniors hold student loan debt, of all things – a scourge striping the young, we thought. Adult education: that’s the culprit; necessary and expensive; funded in the now normal way. Many parents, too, cosigned loans for children, and are commonly left with the albatross. Social Security can be garnished to pay delinquent student loans; humiliation and mockery, stealing joy from the sunsetting seniors.

There’s a good tool to protect against senior debt: life insurance. Life policies are superior planning tools. The death benefit is tax-free for heirs, or can be used to pay off estate taxes. Whole and universal policies have a cash component that can be tapped or borrowed against in extremity (a delinquent loan payment, perhaps), and riders can be bought to pay for healthcare not covered by Medicare. Many seniors slough off their life policies at retirement. If you hold no loans or mortgages and the kids are all solvent, fine. Otherwise, think twice.

Let’s examine that death benefit again in the context of debt. Unpaid loans are hardly the legacy one leaves to a beloved spouse. A life policy’s death benefit can pay off any loans, student or otherwise. Meanwhile, consider that 40% of Americans enter retirement with an unpaid mortgage. No matter the changes of life in our time, in retirement, life insurance is still a reliable partner.

There are more troubles with retirement and they’re showing up globally. Let’s stick with one ratio: the number of working people versus those who are retired. Today, the worldwide ratio is 8:1. By 2050, this ratio is forecast to halve. In developed countries the ratio is tighter: 4.6:1 in the US, around 3:1 in Germany. These, too, are expected to decline dramatically. Who will pay the bill?

Add this in: global studies reveal that, spanning the globe, people believe the reliable solution is to fund your own retirement. People seem to believe this everywhere, no matter the virtues or lack thereof in society, government or economy in their home countries. Don’t trust the state – they’re not good with money. Protect yourself. Lean on family, but don’t bow them down. Think positive – that seems to matter, as well. Upbeat thinkers act.

A bit of general counsel found in all these studies: if you can, keep working. Keep the mind fresh, maintain human contact, put a few bucks in your pocket. Employers need to learn a few things, too. Remote working was possible for 20 years or more, yet was widely resisted; no more. Open-mindedness and a willingness to try out new things will be crucial to solving the aging crisis, and the pandemic has given us a run-through.

Old folks have experience to share, contributions to make that shouldn’t be going to waste. The senior resource, as we’re often bloodlessly termed, is invaluable. That’s good, because we’re going to need the work.

I’m suspicious of some related writing, the kind that promises we can work until 90 or so, launch grand new firms, become millionaires. None of these pundits address my failing eyesight, easy to work around if you’re a writer, rather devastating for my editing business and its endless staring. Age introduces burdens. Still, we can be useful and get paid in the bargain.

Not all of this is new. My Uncle Leo had a long career as a mid-level executive at General Motors. After retirement, they kept him an office, let him work halftime, paid him as such. After age 80 – you read correctly – the program ended, but he held on to his desk, kept coming in, for free. They wanted him around. He could help with tough problems, mentor the kids, soothe the frazzled, stressed generals.

Leo grew up in the Greek part of Alexandria, Egypt, came to the states in the 1950s. One time in the 70s, watching the Celtics at the old Boston Garden, he warned me to stay off the opium. I’d barely heard of the stuff, to this day never sniffed out a scent, thank goodness, but I wonder where he picked up this wisdom. A wise old Greek owl, the kind you want on your team, assuming you like smart and wily.

Retirement today is like turning stones in a wide ocean pool: there’s interesting things wriggling under the rocks, though many are pretty darn slimy. People are nervous, and rightly so. I think the answer lies behind us, in our history. Trust the proven tools, whether human, financial or actuarial, and recognize that embracing the new is an unfathomably long tradition.

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