Love your career because you will work until 70

65.  This used to a magic retirement number. It is so imbedded within our cultural dialogue that most every retirement planning book written prior to 2008 targets 65.

2008 became a watershed year in our economic history since the stock market crashed. But, that’s not the main reason why 65 will be extended for most.  

Three other reasons are larger:

We are all living longer. 1 in 4 who make it to 65 will live past 90.  My guess is that number will shift to 1 in 3 soon enough.  

The majority of those living in Connecticut will not have pensions. It used to be that pension plus social security plus savings were the three prongs of retirement planing.  One prong is now missing.

The incentives to wait until 70 for social security withdrawal are significant enough that most people should wait until then before taking social security benefits.

Moreover, everyone should learn the math behind compound interest.  If you do, you will discover that to earning enough to pay your bills after you have built a reasonable nest egg will be enormously beneficial.  

For example, a 40 something career counseling client from West Hartford, Connecticut discussed his $100,000 401(k) in the context of quitting his job next year.  Unfortunately, $100,000 won’t grow much.  At 5% growth, next year would yield $5,000.  

If he builds a next egg to $500,000, which is reasonable for those who are 65, and then works until 66, that $500,000 will grow to $525,000 with a 5% rate of return.  In 5 years, the nest egg would grow to $641,000.  

There is also a non-financial reason for people to work longer than 65.  Work – at least purposeful work – is healthy.  Good work is good for you.

That we will work more years than our parents is significant for career planning.

I would guess that those in their 20s and 30s are not thinking about what they will do with their careers when they are older.  But, they should. 

So, this post is really focused on those in their 40s and 50s.  If you don’t like your work and had been mentally targeting 65 as your retirement age, devote yourself to finding work you love because you are going to working longer than you thought.