Pondering The Next Stage in Retirement’s Evolution

October 18, 2021

A recent survey confirms that retirement now looks different for everyone, and there is no single path to retirement. Views on retirement differ by generation, with a majority of those surveyed envisioning that their financial future will be different from their grandparents, parents and children.

What’s retirement mean to you? Traveling to exotic locations every year? Golf all day, every day? Learning a new language on an app you just downloaded while relaxing on the beach? Volunteering at your favorite non-profit or starting a new hobby business? Oh, that’s so yesterday. Franklin Templeton’s June 2021 “Voice of the American Worker” survey confirms that retirement today feels “less cookie cutter than it used to be,” according to 82% of those polled.

The survey found that individuals can benefit from personalized guidance to achieve their financial goals – an area where a financial advisor can help. The survey also showed that many participants are also looking to their employers for more tools and resources. But most of all, the survey found that the way participants think about retirement is changing.

A More Holistic View of Financial Well-being

The vast majority of survey respondents associate their current physical (74%), mental (70%), and financial (66%) health with well-being. More than half say their financial well-being isn't primarily about money but includes their health and lifestyle (57%). Interestingly, while workers today place nearly equal importance on mental (81%), physical (80%) and financial (76%) health, they feel least in control of their financial (55%) health as compared to physical (62%) and mental (58%) health.

Many respondents struggle to find a holistic view, with 61% indicating they need to consult many sources to get an overall picture of their finances and 51% stating it is too complicated to integrate all of their financial info and goals into a single picture.

The Future of Workplace Benefits

Three out of four workers want their workplace to provide more resources to help them with their overall financial wellbeing (75%), believing their employer should provide incentives for good financial habits (79%) – as well as good health habits (78%). In fact, workers are more interested in long-term support, over today’s monetary gains, with most preferring a boosted retirement plan match to a raise.

Nine in 10 respondents are also looking for tools to visualize their future and optimize wellbeing, with top choices being planning tools and resources (89%). Tools designed to help achieve financial independence (35%) and visualize long- and short-term financial goals side-by-side (35%) top their wish list. In addition, 62% of respondents say, “Unless I am getting personalized recommendations, I feel like financial education isn't very helpful,” (68% men vs. 54% women).

The Changing Retirement Landscape

Eighty percent of respondents agree that the traditional idea of retirement is no longer accurate for most people’s expectations or experiences, while at the same time, three quarters (75%) say that their future financial goals and plans look different today than they did five years ago.

Respondents also feel it is more important to achieve financial freedom than to retire but that financial freedom is not always as attainable. More specifically, 76% of respondents say there is appeal in achieving financial freedom, while only 56% think it is likely achievable. At the same time, 69% say there is appeal in retirement, while 61% say it is likely achievable – a notably smaller gap.

Workers identified their most important financial milestones today as financial freedom (76%) and financial independence (74%), also indicating that financial independence feels more empowering than retirement (81%). Women find financial independence particularly appealing (81% vs. 68% men).