Retirement ain’t what it used to be
And here’s why clever marketers and product- and service-providers can benefit from this big change.
The youngest Baby Boomers are just five or so years away from being 60-plus and rather than settling into old age like previous generations, they are reframing retirement as the most dynamic stage of life.
Today’s 60-pluses are healthy, active, travelling, purchasing consumer goods, playing key roles in their community, maintaining strong connections to family and friends and are keen for new adventures big or small. And if they aren’t living like this, they aspire to!
When you look at the way people lived in previous generations, it’s clear why marketers in the past did not ‘rate’ this consumer, and it’s also clear why they should now reconsider.
Leading Australian demographer Bernard Salt says there used to be three stages of life: child, adult and old age. Now, he’s coined six, with three of them replacing what used to be the stage we called ‘old’, to reflect what’s now a much more dynamic post-retirement period.
Starts at 60’s insights, gathered over more than five years in which we’ve worked more closely with 60-pluses than any other digital platform, allow us to go far deeper into the minds of the Baby Boomer generation than demographic statistics alone could ever allow.
We even have our own phrases for the three primary retirement mindset: pre-euphoria, euphoria and post-euphoria. Importantly, these mindsets aren’t defined by age, but by the balance of health, financial security and sheer hunger a person has for life.
In short, though, today’s retirees don’t feel ‘old’ at 60.
While their parents may have retired in their 60s and stayed within the same guide rails for the following 20 years, today’s 60-plus is all about living life to the max, cutting corners on or dumping entirely the things that no longer deliver satisfaction and investing in the things that do.
This generation’s unprecedented purchasing power gives them a huge propensity to travel, and that has them rethinking the way they want to work, demanding flexibility in the later years of employment to allow them weeks or months away from the daily grind.
They want to be healthy, so prioritise this from the minute they see retirement in the headlights, both through traditional and non-traditional means.
Their changed outlook on life ripples through their choice of home, with many Boomers considering how they can have a home they can ‘lock up and leave’ for weeks at a time.
Mixed in with all the fun of having freed up time to focus on themselves, though, are some big concerns,
Baby Boomers must consider how to fund their retirement with the knowledge that they may never earn another cent through salary, but will likely live to a grand old age. Many Boomers are also ’the family bank’, with children and grandchildren relying on them for continued financial support.
At the same time, today’s 60-pluses are often helping their own elderly parents navigate the increasingly complex areas of home care and aged care.
Ken Dychtwald, CEO of Age Wave and one of the US’s most prominent researchers on the Baby Boomer demographic, last week released a summary of 10 years of research into this changing demographic. He highlighted five major issues the American Baby Boomer is confronting – and the situation is not too different here in Australia.
Health disruptions: Health problems and the cost of healthcare now top the list of retirement worries, even more so among the affluent. Just one in nine pre-retirees is completely confident in their ability to pay for their retirement healthcare expenses.[Note: This is less the case in Australia, where access to healthcare is universal. But the cost of private health insurance is a worry, as are incurable illnesses such as cancer and Alzheimer’s disease.]
Falling short: Sixty-pluses feel insecure about their ability to fund a very long retirement. They don’t want to be a burden on their families in late retirement, but nor do they want to sacrifice quality of life by being unnecessarily thrifty early in retirement. They also fear being lonely.
New family interdependencies: In today’s uncertain economy, where one or more family members may be struggling financially, balancing an individual’s or couple’s retirement needs with the money needs of parents, siblings, children and grandchildren is an increasingly complex challenge. And partly due to these complexities, most couples now prefer to share responsibility equally for major financial decisions.
Home and community: People are concerned about where they should live in retirement, as well as about finding ideal accommodations for their parents.
Search for guidance: The shift by most governments away from state-funded retirement incomes mean that Boomers recognise they must be more self-reliant, but the worlds of investment and financial services are uncharted territory for most and they feel they need more guidance.
It’s a fascinating shift, and one we are studying, actively serving our consumers in, and working closely with clients to bridge. This process is allowing us to amass invaluable knowledge about the most financially powerful demographic currently in the market.