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Working Could Be a Requirement in Retirement

Thinking about retirement is anything but positive and encouraging, even for those in their 20s with a 40-year time horizon for saving. Most planners recommend an absolutely ungodly sum of cash as the entry point to safe and sound years. The government continues to predict the demise of Social Security. Insurers warn about soaring healthcare and long-term care costs. And now, with the market having wiped out $11.1 trillion in market wealth since it peaked in October 2007, retiring is absolutely unrealistic for many.

Ours is not a business of promising easily attainable, happy dreams. If anything, ours is business of instilling fear.

But last week, in a webinar titled "The New Retirementality," sponsored by sister publication Financial Planning, a consultant condoned an entirely new, positive approach to retirement that could put all mutual fund investors in a far better position for their senior years and, quite possibly, end the trepidation with which they have invested with us. Helping our customers feel empowered about retirement would put our business in an entirely new and positive light.

Mitch Anthony, president of Advisor Insights, said that retiring from work was first suggested by the government when it introduced Social Security during the New Deal to encourage older workers to make way for younger replacements. Retiring also made sense when people relied on physical labor in an industrialized economy.

But today, with so many people working in knowledge-based, service industries, and needing to fight Alzheimer's or dementia as they live longer, moderate work during retirement can be a blessing rather than a curse.

Anthony also believes that as Boomers retire and create a shortage of workers, employers will be more inclined to respect their experience and rehire them.

Certainly right now, because of the market's steep declines, work has become a necessity, not even a luxury, for many retirees.

If investors began to plan for a retirement including a fulfilling, part-time livelihood and added that income stream to their calculations, they would find themselves enormously better off in their senior years. Anthony argues that they would be far more fulfilled, too. I'd add that those planning for retirement would be much more confident, as well, and that confidence would lead to higher savings-a win/win for mutual fund companies and their customers.

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