Why meaningful work matters when planning for retirement
David Kennedy, author of End of the Retirement Age, is an author, consultant and retirement planning expert.
While longer life spans create funding challenges for individuals and governments, rising longevity also means you have decisions to make about how you are going to spend your time as you grow older. A growing number of older Australians are choosing to spend some of their extra years working.
Australian Bureau of Statistics data confirms the participation rate among 55-64 year-olds increased from 43 per cent in the early 1990s to 64 per cent in 2014. Meanwhile, 12 per cent of those aged 65-69 continue to work (up from 10 per cent).
Rudy Karsan, founder of US-based venture capital firm Karlani Capital, is a strong believer in the importance of doing meaningful work. In 2012, Karsan sold Kenexa, the human resources software company he founded and ran for 25 years, to IBM for $1.3 billon. Having achieved financial independence many times over, his reaction to achieving such a business milestone was unexpected.
Speaking during a May 2016 TEDx Talk at the University of Calgary, Karsan said, “That should have been my crowning moment – the day the deal closed. It was the saddest day of my life. It took me months to recover and more than half those nights I fell asleep crying. It was hard. I had lost meaning.”
Meaningful work matters. More recently, Apple CEO Tim Cook was addressing students at the University of Glasgow, after receiving an honorary Doctorate of Science, when he said, “My advice to all of you is, don’t work for money – it will wear out fast, or you’ll never make enough and you will never be happy, one or the other. You have to find the intersection of doing something you’re passionate about and at the same time something that is in the service of other people. I would argue that, if you don’t find that intersection, you’re not going to be very happy in life.”
While Cook was talking to young graduates, his advice is just as relevant to any working person. If you have the opportunity to engage in meaningful roles in your 50s, 60s and 70s, this is likely to go a long way in determining the duration of your time in the workforce. Even Microsoft founder Bill Gates once told talk show host Larry King, “Paul [Allen] and I, we never thought that we would make much money out of the thing. We just loved writing software.”
In other words, rather than working purely for financial reasons, work – and your inclination to continue working – takes on a different dimension when you have a sense of purpose about your job, and feel passionate about what you do each day.
Your 50s and 60s provide the perfect opportunity to reflect on the work you have done during your career, and its alignment or otherwise to your individual values and purpose in life. In my experience, those who are engaged in meaningful work, which they are passionate about, tend to think they will continue to remain active in the workforce well into their 60s and possibly beyond – health permitting. Where they are fit and healthy, they are more likely to reject society’s implied suggestion of retirement at age 60 or 65, and more likely to continue in their vocation, possibly at a decreasing level of intensity over time.
Wendy Thompson is one such example. When Wendy, in her late sixties, eventually retires from her career as a barrister, one of the first things she plans to do is turn the stories she tells her grandchildren into a series of books they can keep as a memento of their childhood. Comfortable with managing a demanding schedule, Wendy also has visions for a food and wine tourism business in Victoria’s Yarra Valley.
But for now, she is focused on working on a number of cases in her highly successful work health and safety law practice.
The motivations for working beyond the traditional retirement age of 65 are many and varied. For some, continuing on is due to financial necessity and the realisation that the amount you have saved will simply not deliver the lifestyle you desire when you cease work.
Wendy is part of a group that continues to work predominantly for non-financial reasons. As a barrister specialising in work health and safety law, she is making the transition from full-time to part-time work as the first step towards eventual retirement. As we discuss her motivations for continuing to work into her late sixties, Wendy’s passion for her career shines through.
“I think because of the nature of the work, I can honestly say I’ve not had one boring day at work. I thoroughly enjoy my work as a barrister. While it involves long hours and complex issues, the rewards I receive from working with other barristers, solicitors and clients from all walks of life make it difficult to move to full-time retirement. It is not just the financial rewards or the ability to work for oneself. It is the intellectual stimulation, friendship and collegiate life at the Bar that are most rewarding,” she says.
Wendy’s transition has allowed her to continue to practice law, but with the flexibility of operating from her home in Sydney, or from her family retreat in Victoria’s Yarra Valley.
“With benefits of technology, I can do advance work. I can read when I’m in Victoria as well as when I’m in New South Wales. So for that type of work, when I say transitioning, I’m transitioning out of more active court appearances. I will pass on to younger junior barristers smaller matters, and matters that require mentions and appearances for that sort of thing. I don’t usually attend [court] myself for such matters unless it’s unavoidable.”
In a world where increases to the retirement age are met with protest, Wendy’s outlook is that age should not be the only determinant of whether someone should retire.
“Given the advances in medicine, I think 60 is far too young to have people retire because of age alone. I know that in legal firms and barristers’ chambers, age is not a barrier to a person working. In many cases, it is preferred because of the experience of the person and their overall knowledge. There are also greater opportunities for the over-60s to start up their own consultancy business or other businesses.”
What, then, might ultimately trigger retirement?
“If there’s any health reason, I would certainly bring forward any retirement plans. And of course, family issues, the health of your grandchildren or partner, and things like that would also weigh on that decision. But if things continue as they are at the moment, I would say I’ve probably got another three to five years to go.”
There are many different motivations for engaging in part-time work beyond the traditional retirement age, including the following:
- A preference for lifestyle flexibility, which allows for a balanced combination of work, family caring commitments, travel, hobbies and other community activities.
- Financial necessity whereby they may not yet feel they have adequate savings to allow them to stop working.
- A desire for regular social interaction.
- A need for ongoing mental stimulation and intellectual challenges.
- A desire to maintain structure and routine.
- A sense of identify and purpose.
- A continuing passion for a particular line of work or business.
- The sense that ceasing work simply feels unnatural or undesirable.
- Fear of boredom.
This is an extract from End of the Retirement Age: Embracing the pursuit of meaning, purpose and prosperity by David Kennedy. Available at endoftheretirementage.com and via Amazon, Booktopia, and Angus & Robertson.