5 Reasons Why Your Retirement Will Be Different From Your Parents

People from the Baby Boomer generation usually believe that the younger ones will be worse off in retirement than they are today. That could be true, but there are many factors that can dictate the outcome of your retirement. 

Financial preparedness is a major one. It goes without saying that the current working generation can still prepare for a comfortable retirement with the right plans and preparations. However, there are also other reasons that can affect the retirement experience of the younger generations. These are:

Increase in Aging Population

One fact about the world’s population (in general) is that it only keeps increasing. Decade after decade, people in the age of 60 will only increase. In the 1950s, there are only 205 million people aged 60 and above. In the year 2050, it is estimated that there will be over 2.1 billion people who will turn 60. 

Low Trust in the Government

So what if there are more retired people in the future? It is believed that these future retirees will be worse off in retirement than their parents. But it is not just about the increase of population, it is also tied with low trust in the government. 

For now, the government needs to ramp up Social Security policies and mandate better retirement plans (for private employers) to give the working population a safety cushion during retirement. However, this agenda is not a priority (for now), thus people are still urged to save up for their own retirement.

Working Beyond Retirement Years

This is actually beginning to be a trend. Many people aged 60 and above prefer to work continuously (whether part-time or full-time). Luckily, there are companies that now welcome such. The need to work beyond the age of retirement is becoming a thing, because the truth is, pension and savings aren’t always enough to sustain one’s lifestyle. 

No Knowledge in Investing

Since many companies are not offering retirement plans, employees are now urged to save and invest for their future retirement. However, this poses a problem since many people don’t really have the financial knowledge and skills to save or invest a portion of their income regularly. 

Health Care Concerns 

Sure, almost all of us are going to have health problems later in life. And this means that our retirement plans should be enough to accommodate skyrocketing medical bills and long-term health care expenses. However, as mentioned earlier, most employees don’t have enough financial skills to save and invest – let alone prepare enough for medical expenses in the future.

Even without health issues, people who could live well beyond the average life expectancy could still struggle financially because of the ever-increasing cost of living. Inflation should always be factored in when it comes to retirement funds and investments. 

In sum, your retirement needs more planning and work than your parents. Without employer-funded plans, you need to step up and put in the effort of saving and investing if you want a comfortable retirement in the future. You may also be retiring later than your parents did – not because you have the option too, but it is also because your savings might not be enough for a financially-secure retirement yet.

As of the moment, society (and the government) still have to make major moves when it comes to retirement funds and social security policies. This concern is always placed at the backburner because of problems that require urgent attention (such as crime, environmental, and economic concerns). 

However, flexible retirement and stable social security system should go hand in hand with plans of education reforms and other social welfare benefits. Sure, young people need access to quality and free education, but these people will grow old too. Sooner or later, each one of us needs a safety cushion at the end of our working age.

Do you want to have a smoother transition into life after retirement? You should start preparing today by looking for a steady passive source of income. You can easily earn with the help of your smartphone. How? Click here to learn more.

Watch this video and learn about the sad truth that older Americans face when it comes to retirement. 

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