"(Baby boomers) share a strong view that retirement is not an end but a beginning, an opportunity for reinvention."
Baby boomers are rethinking retirement in an age of economic uncertainty when people are living and working longer. They are placing more importance on peace of mind rather than accumulating wealth, and focusing their retirement planning on reinvention, connectivity and traditional values, according to a new Merrill Lynch Retirement study.
“Boomers have always paved their own way, and are once again pioneering new territory,” said Andy Sieg, head of Global Wealth and Retirement Solutions for Bank of America Merrill Lynch, in a statement. “They share a strong view that retirement is not an end but a beginning, an opportunity for reinvention. Their perspectives, concerns, goals and how they plan to achieve them are different. What they seek is clarity and confidence about what is possible in the context of their hopes and myriad uncertainties.”
Related story: Retirement planning advice: What’s the best source? Click here to read more.
Achieving peace of mind is seven times more important to baby boomers than accumulating wealth, the survey of more than 6,300 respondents ages 45 and older found. How are they working to achieve this nirvana in their retirement years? As is characteristic of boomers, a forward-looking generation, they are taking a revolutionary reinvention of retirement. They view what Merrill Lynch terms “the longevity bonus” as an opportunity to explore new life options, pursue dreams deferred and live their lives to the fullest.
Fifty-five percent of respondents consider retirement a new chapter in their lives and not an epilogue. Just over half (51 percent) of pre-retirees who plan to work in retirement indicated they want to launch into a different line of work.
Another retirement priority, the survey found, is forging or strengthening connections with family, friends and communities. Although pre-retirees think a steady income is what they will most the most about leaving their career, they said it is the social connections they will miss the most. In addition, the “sex, drugs and rock and roll” generation is embracing traditional values, defining happiness in terms of new experiences, peace of mind, helping family and making a difference. Nearly three-fourths (74 percent) said that values and life lessons are the most important things to pass on to future generations, vs 32 percent who said financial and real estate assets.
The survey also pinpointed sources of concern for boomers as they plan for retirement. Many will be forced to balance their retirement needs with the financial needs of parents, children and siblings. More than half (52 percent) of respondents who are parents expect to provide their adult-age children with some form of on-going support, including financial mhealthcare, housing or education. More than one-third (35 percent) said they will need to also provide this support to their grandchildren.
The “longevity bonus” has financial ramifications for retirement planning. Not knowing how long one is going to live can cause insecurity about the ability to support a long life. Not surprisingly, health issues topped respondents retirement concerns, specifically being serious health issues (72 percent), being a burden on one’s family (60 percent) and outliving one’s assets (47 percent).
“Americans have mixed feelings about living longer and transitioning into retirement,” said Ken Dychtwald, Ph.D., founder and CEO of Age Wave, in a statement. “Even those who have saved adequately can be anxious and often overwhelmed by this complexity and the unknowns they face.”
Related story: Financial advisors key to baby boomer retirement readiness. Click here to read more.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.