Generation Screwed: Why Retirement is a Joke

Notes

Gold watches, a fat pension and a beach house in Florida. Your grandparents’ generation spent their lifetime paying the bills, raising your parents and saving for retirement. They put in 40 years of hard work to spend their golden years in comfort and security.

Generation Screwed

You, however, are in for an interesting ride. GenY has now earned the name GenScrewed.

With median income flat or declining, higher student loan and credit card debt, a high unemployment rate and competition from nana and pop-pop as they stay at work longer to shore up their retirement fund, things aren’t looking so great. Especially when governments are also raising the minimum eligibility age for various retirement benefits.

In fact, according to the U.S. Census, the median net worth of people under 35 fell by 37% during the recession, far worse than the 13% drop among those over 65. The traditional view of retirement as a shimmering paradise in the distance is looking more and more like a mirage.

It’s not surprising then that the generation that is rejecting car and home ownership is also changing their approach to the connection between work, finances and their vision of retirement.

Work with Meaning

While your parents most likely divided themselves between stable, well-paid but often unfulfilling work and limited, precious but very satisfying personal time, your generation is blurring those boundaries by seeking meaningful, flexible work that blends seamlessly aspects of your professional and personal lives.

Many of you are taking jobs based on whether they are aligned with your values, make you happy or can help you change the world. It’s not just another way to earn a paycheck, but a way for you to chase your dreams.

And while this isn’t true for every single member of GenY, this generation has an unmistakable penchant for entrepreneurship and creativity.

But if you’re already getting paid to do what you love, why would you ever retire?

Older generations may have postponed their projects of passion until their golden years, but GenY is all about living your dream today. Just like the gold watch and fat pension, retirement has become an outdated concept for many young people who are already pursuing their dreams.

The New Rules of Retirement

If the old retirement was about having enough money to live out your dreams in your golden years, the new retirement is no longer about having a sizable 401(k), but about being financially healthy and creating real “wealth”. And real wealth comes down to two very simple things:

1. Free Yourself: Live Your Dreams Today

If your dream is to take a permanent vacation from decades of unfulfilling work once you hit 55, you’ll need to save a lot of money to make that happen. But if your plan is to keep doing the work you love with a few occasional vacations well into your 70s, your choices are much different.

Without the need to take a high paying but unfulfilling job or an impatience around hitting a certain dollar figure by the time you hit your fifties, your generation can choose a vastly different financial journey that can be comfortable and secure while being extremely fulfilling.

The key is to make your dreams attainable by dividing them into smaller goals. As long as your make the commitment to grow each day, value the journey more than the destination, find ways to continually inspire yourself, and are willing to sacrifice pleasure for opportunity, you can dream as big as your imagination allows. While this requires you to focus on your priorities and to give up some things to gain others, it is far more constructive way of dealing with the challenges of today than the old system ever would be.

2. Prepare Yourself: Handle Unexpected Bumps in the Road

Every day is unpredictable. Sometimes you’ll face unexpected challenges like an illness, a loss of employment, or a natural disaster. You should always prepare yourself so your dreams don’t suffer. You may have to work hard to keep three months of living expenses set aside in emergency savings, but developing healthy savings habits and making thoughtful spending decisions will keep your dreams safe.

Yes, the magical finish line of 65 is quickly disappearing. But savvy folks understand that this isn’t a limitation, but an opportunity to throw out the conventional thinking and to build a life that’s right for you.

And if you need a little bit more inspiration to get started, check out this video courtesy of Trey Parker and Matt Stone of South Park fame.

Tell us: What are your plans for retirement? Are you living your ideal life now or waiting until you retire? Tell us below.

Image credit: Steven Depolo