Retirement is a new thing

April 21, 2022   ·   0 Comments

Dear Money Lady, I am 70 years old and still working.  I feel great and don’t plan on stopping.  You should write something for those of us who don’t plan to slow down yet.  –Jim

Okay Jim – I will.

Most people today think that retiring at age 65 has always been the norm, but really it has only formally been around since 1935, when many governments passed the social security act, establishing government welfare for retirees and setting a standardized formal age of 65 for retirement.  The Canadian Pension Plan (CPP/QPP) only started in April 1965 and the Old Age Security began January 1966.

The idea for retirement came from Prussia in 1881, when Otto von Bismarck came up with a government run financial support system for citizens over the age of 70.  At the time, this was a radical move since everyone around the world never retired.  You simply kept working until you died and at the time in the late 1800’s and early 1900’s the average life expectancy was only 61, so the chance of you getting to retirement was slim-to-none.  Now retirement is the “buzz-word” for your leisure second chance at life, when you can sleep in and golf every day.  People are living much longer and instead of retirement being 5 years or less like it was in the 1960’s, it could now be as long as your working career, 30 to 40 years.

With this in mind, and for the benefit of you Jim, I decided to do a little research.  According to Stats Canada, 36% of Canadians aged 65 to 74 are still working full-time, and 13% of those aged over 75 are also still working.  I was surprised by this finding, and I am certainly not advocating working into your elder years or continuing to work until you die; however, obviously these stats show that a lot of Canadian retirees are not just sitting around.  Whether you need the additional income or not, many older people are working part-time to feel purposeful.  There are many retirees that have now redefined the term “retirement” by focusing on volunteering and service, giving them a way to spend their time in a meaningful way and at the same time seems a lot like it did when they were working. 

Contrary to popular belief, there is no “right-time” to retire and if you are in good health there is no real need for rest and relaxation every day until you die.  Retirement was not intended so that everyone would get it, even though we now believe we all should.  The 65-year age of retirement was chosen by economists and actuaries when social security was created, when life expectancies were much less than they are now, and only provides a generalized guideline for those who want to know the government’s “right time” to do their hard-stop to working.  The reality is, most Canadians are now retiring much younger than 65 with 61 being the median age, but 65% of these retirees under the age of 65 are continuing to work part-time.  It is a false notion that in order for you to be retired that means you never earn money again or be defined by an age cap.  Continuing to work while in retirement has so many benefits for you.  Being socially connected, physically active, mentally sharp, and the benefits of additional revenue all make a case for continuing to work while in retirement.   They even say that those that work part-time in retirement have fewer health problems.  Boredom is a common complaint that I hear from my readers and when in retirement you never seem to get a day off – so, why not give yourself a break from all that rest and relaxation, and consider getting a part-time job?

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