Introduction and Overview
I am sure that as you approach retirement, you would be asking yourself whether your pension and retirement savings will be sufficient to maintain your quality of life and do all the things you always planned to do, but somehow never got around to doing during your working life?
Or if you have already retired, you may be finding that you are spending more than you budgeted, or that the interest on your investments is much less in these times of low interest rates.
The Global Financial crisis which started in 2008 made this far worse, as the value of people’s pension, superannuation or 401(k) pension funds was slashed.
Another factor is that for the first time ever, in many developed countries, the percentage of the population over 65 is equal to or exceeding the percentage that are 14 or under, averaging around 17%. So the percentage of the population working, whose tax deductions have to fund social security benefits is getting smaller and smaller.
This trend has been accelerated by the baby boomer generation, born after World War 2, between 1945 and 1964, now reaching retirement age. This trend is set to continue
Now add to that the distinct possibility that you could live for many more years than you expected, as longevity medicine and treatments become generally available in the coming years, and it will probably increase your concerns even further.
So unless you take steps to bring in some extra money, you may decide to cut your budgets to conserve your savings “just in case” you live longer. By doing this you are making your ongoing day-to-day lives more difficult.
Broader Social Issues That Could Have an Impact on Your Social Security and Pension Benefits
Unfortunately, to a large extent, the developed nations are still ignoring the dramatic changes in potential healthy life expectancy and consigning people to the scrap-heap to become a burden on their social security systems, when those people could, and would like to, be continuing to contribute, to earn additional income.
Income that would not only benefit them personally, but also reduce this looming burden on society that has every government in the developed world worried about how they will fund increasing social security and medical costs.
As people are now living longer and healthier lives than ever before, the current retirement age in most developed countries has fallen way behind average life expectancy and is completely outdated. The world cannot afford to keep wasting this amazing, vastly under-rated and under-utilised resource.
Of course this will not have an impact on age-prejudice in the workforce which is as alive and well as ever. I guess that the only cure for that will be a scarcity of suitably qualified people available to fill all the slots as the workforce shrinks as a percentage of population.
It is in the interests of all Nations and the World to utilise the wisdom and knowledge that older people have gained on their life journeys to make the present and future world a better place.
This trend is set to continue, and it has been concerning governments and policy makers for some time. Keeping this growing ageing population healthy and active has become crucial if we are to avoid unsustainable growth in Government debt and unsupportable strains on our health and social security systems.
So there are many reasons why it is in everybody’s interests to solve the problems of ageing, to allow this growing generation of older people to remain healthy and active, so that they can continue to contribute to society, rather than becoming a burden that society has to bear.
Research is showing that many baby boomers simply don’t have enough money put aside to maintain their lifestyles, especially with a potentially longer active life (In a recent article in USA today 34% say they haven’t saved enough, 19% want additional income, and 9% need health benefits. Only 21% of respondents expect to immediately quit working when they retire)
A big factor in this has been the progressive move by corporations to unwind their “defined benefits’ retirement funds, under which members were guaranteed a specific retirement income, in favour of defined contribution funds, where the amount that employees and companies contribute is defined, but the return received is in the hands of the investment decisions individuals make and to market fluctuations.
To make matters worse, the Nations of the developed world are reeling under the burden of their social security systems from the growing number of Boomers reaching retirement age, with a high percentage relying on social security as their primary source of income.
The Global Financial crisis which started in 2008 made this far worse as the value of people’s pension, superannuation or 401(k) pension funds was slashed.
- A USA Today article also reported that, according to a recent report from the Social Security Administration “Without some type of reform, Social Security benefits will need to be cut by 23% in aggregate by 2033. “
- Significantly, the article also said that “Employment is no longer a taboo retirement activity. Sixty-five percent of Baby Boomer workers (in the US) plan to work past age 65 or do not plan to retire at all.”
- Given all the above factors and the likelihood of a longer healthier life, coupled with the positive outlook on life that baby boomers are renowned for, this is hardly a surprise, but is welcome news for the Social Security system and the Government.
- In 2011 in the US, among those over age 65, 87 percent of married couples and 85 percent of singles received money from Social Security. These benefits represented at least 50 percent of income for 52 percent of couples and 74 percent of single recipients, according to the Social Security Administration.
- “The simple fact is that once people get past 65, certainly once they get past 70, the overwhelming majority of Americans collect a Social Security check, and that Social Security check constitutes the largest single element in their retirement income,” Burtless says.
You can read more by clicking the link below:
To meet the long-term care needs of Baby Boomers, social and public policy changes must begin soon. Meeting the financial and social service burdens of growing numbers of elders will not be a daunting task, however, if necessary changes are made now rather than when Baby Boomers actually need long-term care.
A major public policy concern in the long-term care field is the potential burden an aging society will place on the care-giving system and public finances. The so called “2030 problem” involves the challenge of assuring that sufficient resources and an effective service system are available in thirty years, when the elderly population is twice what it is today
Employers are concerned about a skills shortage and that there won’t be enough people working to fill the jobs required. The government is concerned about the cost of health, aged care and pensions and the bottom line is that we need more taxpayers to support this growing cost.
The solution is staring them in the face. It’s about time they gave it serious consideration.
I hope you have gained some value from this brief report. There are some significant issues that could have an impact on your ability to maintain your quality of life throughout your retirement years.
But as I have indicated there will be opportunities to make extra money, not only once you retire, but also in the years leading up to your retirement.
The really good news is that when it comes to making extra money for your retirement The Internet Has Changed Everything
If you need some more positive news after reading some of the depressing (but relevant and important) news in this post, take a look at the article below which explains how the internet has created an infinite number of opportunities for you to make extra money for your retirement.
I feel very excited and privileged to have been given the opportunity to spend my third life phase (from retirement onward) making a real difference in the lives of as many older people and their families as possible, and make a real difference in the world, as it makes the transition to the expectation of a longer healthier and wealthier life than ever before.
I hope to get to know you better as we share our journeys, helping each other, and many more people like us, to make our third life phase as good as it can possibly be.
I have recently released my updated free eBook “How to Create Your Personalised Blueprint For a Long, Healthy and Wealthy Retirement Life” which covers all the topics in the Design Your New Life 4 Part System including how to earn additional income in your retirement years.
If you haven’t already done so, you can download your personal copy by clicking on the link below:
This report provides a helpful overview of what you will learn in-depth, if you join my new program “Blueprint for a long, healthy and wealthy retirement life”
Last Updated October 2018
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