As personal finance bloggers sell dreams of retiring early, Mitch Anthony is asking professional advisors to rethink the value of retiring at all.
Anthony, an advisor coach, speaker and author focused on financial life planning, argued that the modern concept of retirement is flawed during a Thursday presentation at Financial Advisor’s 9th Annual Inside Retirement Conference in Las Vegas.
“Retirement is a social construct that no longer fits the age we live in,” said Anthony. “It is an artificial finish line imposed upon our lives and based on age, and I can document this: The chief cornerstone of all retirement policy is nothing less than ageism.”
Ageism, meaning that as workers reach 62, 65 or 67 years of age modern society expects them to retire to a life of leisure and lower productivity, said Anthony.
Retirement at a certain age has become compulsory, said Anthony, which has led to a narrow focus on financial fitness across clients’ lifecycles.
“This industry has had a tunnel vision around retirement for years, mono-maniacally focused on numbers,” said Anthony. “Consequently, we see a lot of people struggle with this thing we call retirement.”
When Chancellor Otto von Bismarck signed a law implementing compulsory retirement in Germany in 1885, it was the first example of modern retirement combined with a social security system, he said. At the time, the mandatory retirement age was 70 years old, but the average life expectancy was 46.
The law made sense at the time because Germany was an industrialized society where workers traded their physical output for a paycheck. As they aged, it was no longer possible for them to be as productive.
“Now, come to where we live today, 133 years later, how many of you feel like you’re living an industrial age life? Is your clientele living an industrial age life? The correct answer is that most of us are not,” said Anthony. “What is it we’re trading for a paycheck today? The first thing we have to acknowledge is that we’re trading intellectual knowledge for a paycheck. It’s between our ears. “
Workers also provide relational capital, noted Anthony, in their ability to forge and strengthen networks of other people. Neither intellectual nor relational capital decline at age 65, said Anthony. “Intellectual and relational capital all adds up to something we call experience, and I believe we’re living in something called the experience age,” he said.