The days of working fifty years from nine-to-five, just to claim a gold watch at retirement are long gone.
New trends in retirement mean changes to the way people plan and invest for the future. RBC Wealth Management-US examined the issue and identified five developing trends, presented in our linked article for your enlightenment.
First of all, the modern family is changing – movement has been apparent for decades, but the pattern is now solidifying. For example, in the 1960s, around three-quarters of American children lived in homes with two parents. These days, a bit more than half live with a single parent.
How did the change come about? Easier divorce, lessening of the social stigma of living together and the simple decision of single people, particularly busy professionals, to have children without waiting for marriage have all played a part. The closely watched millennial generation seems particularly likely to wait longer to get married, or simply not bother at all. The new family has specific funding capabilities and planning needs that call for a fresh approach from financial advisors.
Next, consider the trend for longevity and better health. In the US, people can expect to live longer and be healthy enough to enjoy their extended golden years. Older people often remain active, starting businesses and finding a host of ways to generate income post-retirement – if that condition can be said to even apply. This means more resources in the hands of seniors than ever, which can be put to good work in investments.
The downside to longevity is increased pressure on chronically underfunded Medicare. RBC’s specialists expect Medicare premiums to rise for those still in the workforce, while the organization itself will have to find ways to make medical care more affordable. Changes are unavoidable and are likely to be contentious.
For more information, please read:
5 Trends That Could Reshape Retirement | ThinkAdvisor