Monday, May 18, 2009
What is your "number"?: The false promise of idle retirement
I'm not a big believer in retirement before disability. Given the propensity of market democracies to vote themselves lush social benefits at the expense of their posterity, idle retirement will soon again become a rare luxury, just as it was before the rise of the welfare state. Historians of the future will regard widespread idle retirement for the masses as a passing phase between the lengthening of life spans early in a country's rise to wealth and its inevitable fiscal decadence a few short generations later. Besides, I like work and think that if you have a job you do not like for more than a few years (everybody has a painful job at one time or another) then you should rectify your situation or change your attitude.
So, with all of that background, I basically deplore the "what's your number?" ad that Dutch bank ING is running on CNBC (go here and click on "watch TV ads" if you have not seen them). Your "number" is the money you need to retire from financially productive work. That irritates me.
If we are ever going to recover from the current crisis and the profligacy of the Obama administration, we will need people to work more and retire less. They will be more likely to do that if they respect gainful work and develop a constructive attitude toward it than if they are constantly fantasizing about "their number." Selling idle retirement to most Americans under, say, 50 today not only causes people to want something they probably will not be able to have, but to resent something they are going to have to do. Yes, the purpose of advertisement is to sell a vision, perhaps even a fantastical one, but that does not make it any less antisocial.
19 Comments:
By 
D.E. Cloutier, at
Tue May 19, 12:05:00 AM:
Your attitude may change if the top U.S. federal income tax rate goes back up to 70, 80, 90 percent.
In the 1940s and 1950s, for example, many successful guys made a bundle (on paper) in a short period of time but collected it over a 10- or 20-year period to avoid giving nearly all of it to the government. In the late 1940s both of my grandfathers retired before the age of 50.
Quite frankly, TH, a man should have his fortune by the time he is 50. Then, if he wishes, he can kick back as a board chairman, working about 25 to 28 hours a week (including business lunches and dinners).
Meanwhile, remember this: a conservative telling people how to run their lives is not much better than a liberal telling people how to run their lives. Libertarians and libertarian Republicans mind their own business.
By JPMcT, at
Tue May 19, 12:25:00 AM:
I think the term "idle retirement" is a bit misleading....as though retirement is an entrance into a fugue state.
I look upon retirement as the shift away from what you HAVE TO DO and into the phase of life where you accomplish what you WANT TO DO.
I've got a ton of things that I want to accomplish before I become worm-chow, and working 80-100 hours a week doesn't leave much time to make a dent in the list.
Looking at it another way...there seem to be a growing number of people who are "idling" in their jobs. I suspect that they will become "inert" upon retirement.
By 
, at
Tue May 19, 01:28:00 AM:
DEC : Meanwhile, remember this: a conservative telling people how to run their lives is not much better than a liberal telling people how to run their lives. Libertarians and libertarian Republicans mind their own business.IMHO, TH was simply saying that economic necessities will force many people to work past the time they had intended to retire. I will be one of those people.
By , at
Tue May 19, 01:47:00 AM:
@ TH: Why is the very idea of idle retirement bad? If I want to work my investments job at 60-80 hours a week for a few years to let myself study the piano or violin for the rest of my natural life, why is it bad for me to do so? Does your answer change if I decide to sell my services thereafter, as compared to playing for free? I thought the very point of a free market was to allow people to make such decisions and pith the normativity from economic decisions not your own.
By D.E. Cloutier, at
Tue May 19, 02:02:00 AM:
To Boludo Tejano,
Don't worry. Ray Kroc (McDonald's) was peddling milkshake machines at the age of 52. And 65-year-old Harland Sanders (KFC) used money from a Social Security check to fund his first visits to potential franchisees. The best day of your life is always tomorrow.
By TigerHawk, at
Tue May 19, 06:25:00 AM:
To be clear, I broadly agree with DEC, especially in his last comment regarding Ray Kroc (which stands in at least slight opposition to his earlier comment about having a fortune at 50). There will always be people who can afford what I call an "idle retirement." My point is that I believe that the proportion of such people will fall dramatically throughout the Western world over the next couple of generations because of the decision by the current voters here and in most of Europe to vote themselves so many benefits.
Finally, when I say "idle retirement" I do not mean a dissolute retirement, although there are certainly people who aspire to that, too. No, I mean a retirement largely free from work for W-2 income.
By , at
Tue May 19, 10:20:00 AM:
Meh, given what the economy has done to whatever retirement funds I had, I'll still be working three days after I'm dead.
SeniorD said it.
By , at
Tue May 19, 10:22:00 AM:
I agree with you in principle, TH, but I fear things will get ugly in practice if pensions are immediately scaled drastically back. People hit the wall mentally and physically at different ages. Does one really want a doddering 72 year old out on the factory floor, knowing a bad accident will result in an OSHA investigation, a possible lawsuit from the injured, pressure from Monday morning quarterback superiors and possible insurance cancellations? If they lose their jobs, where will an elderly person find work? Especially in an enviroment of high unemployment? Will retirement just be for the politically connected? I gotta run. I fear you are right about retirement and if you are, I believe there is social and more fiscal turmoil ahead for us.
By TOF, at
Tue May 19, 11:03:00 AM:
You over-simplify TH. It is clear that your concept of productive work is extremely limited. Since I "retired" I have taken up a couple of volunteer jobs (at no pay), plus done a lot of things I couldn't do because my "work" kept me from focusing on them. Now, in my seventieth year, I'm beginning to feel the limitations of age. Working for some knucklehead for pay for the past fifteen years or so wouldn't have been nearly as satisfying as what I have done.
By Dawnfire82, at
Tue May 19, 11:03:00 AM:
"Does one really want a doddering 72 year old out on the factory floor..."
At one point in the history of our society (like, most of it) that's what families were for.
High mobility, an ever-increasing social emphasis on individuality and selfishness, and the utterly amazing ability of people to alienate their children these days have changed that.
By Charlottesvillain, at
Tue May 19, 11:29:00 AM:
This is just another of the many advertising campaigns pitched to the fantasies of the baby boomers. It just isn't as recognizable because it doesn't address weak streams or limp dicks.
By D.E. Cloutier, at
Tue May 19, 12:25:00 PM:
TH: "which stands in at least slight opposition to his earlier comment"
The ability to hold two opposing ideas in your mind at the same time is quite useful in today's pragmatic business world.
By , at
Tue May 19, 12:29:00 PM:
The pharmaceutical industry, fortunately, has already addressed the issue of limp dicks; and I for one aspire to a dissolute retirement.
By TigerHawk, at
Tue May 19, 12:33:00 PM:
The ability to hold two opposing ideas in your mind at the same time is quite useful in today's pragmatic business world.Heh. My CEO and I say (to the point of tedium, actually) that "the ability to hold two opposing ideas in your mind at the same time" is an essential attribute of successful executives at our company. Point is, I could not agree more.
By Simon Kenton, at
Tue May 19, 12:40:00 PM:
I'm calling out the academic/professional weltanschung here. You can see the same thing with Instapundit exclaiming over life extension. You really see it when some 'economist' states that we can paper over the Ponzi Scheme aspect of social security by just making 'them' work an extra year or two. It makes perfect sense if you have a law degree and real expertise steering a desk into the teeth of a storm. If you've been laying carpet, or air-stapling roofing, or working in a concrete pour operation, or framing, or running a continuous miner, or tooling an 18-wheeler, your body is shot in your early 50s, and your expectation for the miraculous extra years of life from 60 - 120 is, at best, 60 years of being a Walmart greeter. Most of these guys are just amazed that the Tigerhawks and Instapundits can get time off and amass the energy and still have the functioning joints to "go for a jog" or "get down to the gym 4 or 5 days a week for a workout." TH, you need to look at the oldest guys on a construction crew, look at how they move. Or take a 2 week vacation and join a crew or function as a carpet-layer's apprentice. Then I'll offer more respect to your authority on who should be working how long.
I think these 'number' exercises are great, at least for kids. (And congressmen, were they not too stupid or mulish to face the implications.) They've got to learn how much money and what rate of return are necessary to fund themselves in retirement.
By , at
Tue May 19, 01:39:00 PM:
Simon Kenton,
Too true. My father was worn out by the time he was 51. He died at 52. I'm 53 and in much better health (obviously) than he was at the same age, but probably in better health than he was at 45.
My brother in law is 58, has worked at a variety of physical labor jobs, and is pretty worn down at his age, although he still works hard on his farm and in his shop repairing farm equipment (tractors, combines, etc.).
People do wear out at different ages; not everyone has the genetic inheritance to live into a vigorous age of 75 and still be working.
Judging by my present finances, I will still be working at least two years after I'm dead just to catch up. :)
-David
By TigerHawk, at
Tue May 19, 03:03:00 PM:
Simon Kenton - I don't deny that, but the economy has changed a lot in the last generation. Fewer and fewer jobs are demanding physically, which is one of the reasons for soaring obesity. Most people fly a desk, or do something else relatively sedentary. As for my spare time, do not compare me to a law professor -- I am committed for very long hours, and fit in time for the other stuff because I barely sleep and only occasionally waste time on television. Neither do I socialize much.
By Elise, at
Tue May 19, 06:16:00 PM:
It seems to me that the real problem is not that people want to retire before disablity but that the way the system is currently set up means they’re doing it at least partially on someone else’s dime. If my retirement fund was simply money I had saved up then whether I retired at 35 or 95 wouldn’t be anyone’s business but my own.
So to the extent that you’re talking about making a virtue out of the apparently inevitable necessity of working later in life, TH, I agree with you. We’re going to have to face up to financial reality eventually so we might as well stop pining for what we can’t have and focus on making the best of what we can have.
I don’t think, however, that’s there’s something intrinsically better about people working for wages if they can afford not to do so. You are, after all, talking about continuing to do what you enjoy - work. If I enjoy spending my days reading trashy novels and eating bon-bons, that’s my business as long as I don’t ask anyone else to buy the books and the sweets.
By , at
Tue May 26, 03:29:00 PM:
... we will need people to work more and retire less. They will be more likely to do that if they respect gainful work and develop a constructive attitude toward it than if they are constantly fantasizing about "their number."With the appointment of a new person to head our organization, the work environment has deteriorated to the point where the only rational thing to do is leave.
If I were younger, I'd be looking for another position; at my age, retirement is probably the only option.
