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Retirement and “Doing What You Want to Do”

Two weeks ago, I profiled a rather brilliant article by Physician on FIRE, a popular blogger in the FIRE (Financial Independence Retire Early) movement.  As you may recall, he examined the reasons why some physicians continue to work after they have achieved financial independence and could comfortably retire; the number one reason being that physicians love their jobs.  For other individuals, such as tenured faculty, this may also be the case for why they often end up working long past retirement age.  For these individuals, after achieving financial independence, “doing what they want to do,” is to do the job they love to do, which is why the alternative - retirement - is not attractive to them.

Clearly, this is not the case for all individuals, or we would have many more people working past normal retirement age!  And, this is generally a good thing, since, if everyone worked past retirement age, others would have more difficulty being promoted, and potential employees would be less likely to work for an entity where few people advance. 

So who are the people that are capable and have the desire to retire on time or even early?  There is one universal trait they share: they have the financial means to do so.  Right now, that is not a lot of people (particularly when referring to early retirees), although, thanks to better financial education and movements such as FIRE, the number is growing.  Of course, even for those who have the means, they must also have the desire to retire in order to “do what they want to do.”  If their current state of employment is more attractive than the future state of retirement, then even those with the financial means to retire are not going to do so.

Those individuals who don’t yet know what they want to do might not choose retirement either. They might not love their jobs, but they may still view working as better than the alternative, since they don’t know what they want to do.

And there is an additional group of individuals who know what they want to do, but for whom aptitude is an issue.  For example, when I was younger I dreamed of being a college basketball official.  If I had the financial means to do so when I was younger, I would have most likely pursued that dream full-time, even though I loved my job (and still do).  However, even during the part-time pursuit of my dream, it became apparent that I simply did not have the aptitude to be a college basketball official.  So, from my own personal experience, I believe aptitude would be important in retiring to “do what I want to do” since failing miserably at something does not seem like the type of retirement one would want, at least to me.

And finally, I have witnessed people who think that they dislike their jobs so much that they cannot wait to retire, do so as soon as they are financially able, only to be equally as miserable in retirement.  The reason for this: I believe that these individuals did not truly retire to “do what they wanted to do,” but to simply stop doing something.  They stopped doing something, but they had no true plan for what they were going to do, and ended up just as unhappy.

The takeaway for retirement plan sponsors is that they will likely have employees in ALL of these categories, plus others that I have not described. Thus, planning for the orderly retirement of employees will require a great deal of customization, as retirement incentives that are effective for one employee are likely to be ineffective for others.

Note: This feature is to provide general information only, does not constitute legal advice, and cannot be used or substituted for legal or tax advice.

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