The dangers of a spontaneous approach to retirement

The baby boomers’ retirement will be much different from earlier generations; nothing new there. However, a different perspective is on the temporariness of their lifestyles.  It seems that nothing is permanent any more.  David Houle has referred to this as “no-placeness.” The baby boomers have led very mobile lives.  They have changed careers more often than their parents.  They have changed homes and even marriages more so than earlier generations. They are ripe for the no-placeness movement.  Lives that plug-in and plug-out quite easily to fit the current needs of the individual.

This perspective isn’t new.  In 2008 a similar viewpoint was expressed in an opinion piece in the Wall Street Journal by Peggy Noonan.  In talking about the end of placeness in the U.S. election she said; “Messrs. Obama and McCain are not from a place, but from an experience.” Noonan talks about how some of us seem to be able to live anywhere—we are from anywhere.  She refers to this as a “floatingness” and talks about the propensity for Americans to relocate. “They like moving. Got a lot of problems? The answer may be geographical relocation.”

Houle attributes this change to no-placeness to the economic turmoil starting in 2007.  He writes “…the historically unprecedented loss of wealth, bankruptcies…the inability to sell to move for work has created the beginning of a new way of thinking about ownership versus rental.” Although Canada has experienced increasing rates of home ownership and home prices since the global financial crisis we are not immune to no-placeness. Multi-property ownership, mainly in the form of vacation homes from the discounted U.S. marketplace have increased. More Canadians have entered into the income property-landlord business. Boomers are also highly mobile, visiting grandkids who are geographically dispersed as well as travelling the world.  Boomers are not rooted to a neighbourhood or even a city.  Options seem endless.

What does this mean for our retirement years?

This trend of no-placeness has some interesting implications for our older years. Those are the years when our health, and possibly our finances, means that we need to slow down. The risk of no-readiness means personal and policy level implications such as the:

1. Inability to forecast and fulfill age-related health and social needs by geography. Policy experts would be faced with forecasting for a moving target. A Service needs may be unanticipated in some locations.
2. Less supportive networks to assist older seniors at a time when demand on formal services is overwhelming.  Relationships with neighbours, faith groups, seniors’ communities and other outreach groups have not been established.
3. Sell-off of assets to fund the later years may occur at discounted prices because of volume of baby boomer sellers.

No-placeness and freedom in retirement can be very positive. But don’t be caught in no-readiness. Build and maintain supportive networks!

Lee Anne Davies has worked as a consultant for insurance, wealth management, banking and financial education companies. She has a PhD in Aging, Health and Well-being and a Masters of Arts (MA) in Gerontology and Health Studies from the University of Waterloo and an MBA from Athabasca University’s Information Technology Management program. She’s also successfully completed the Canadian Securities Course and the Professional Financial Planning Course. To read more from Davies, visit her blog Agenomics.