The Retirement Entitlement

Every now and again, I bump into someone suggesting that retirement is not an option, we can work for ever and above all, it is not an entitlement.  When we look at that particular buzzword – entitlement – some of us wonder how its place in the lexicon became so reviled.  Nothing we are entitled to comes without sacrifice and the time spent earning it.

So when Donnie Johnson, columnist for the Free Lance-Star in Fredericksburg lashes out at the topic, suggesting that the historic nature of retirement is a recent phenomenon, he would be right.  Historically, retirement is a new idea for a world that has changed since the days when he suggests “It says nothing about retirement in the Constitution or the Declaration of Independence. And retirement is not mentioned in the Bible. So where is it written that a person is entitled to retire after working so many years?”

A great deal of the retirement conversation revolves around two things: predicted longevity and projected income.  Both are key to any retirement plan but at the same time, both are amazingly abstract.  Interconnected in such a way as to make one essential to the other, no one knows how long they will live and how much they will need.  We pick arbitrary numbers and hope that we are wrong.  In my experience, no other outlooks how for the best while expecting, even planning for the worst.

Retirement planning has taken on the concept of battening down the house, shuttering the windows and gathering the family in the safest spot  for nothing more than a rain shower.  We simply don’t know and it is this fear that we are living with that makes us wonder not when, but if we will retire.  But Mr. Johnston, who looks to be retirement age in his bio pic suggests that we work forever because as he writes, work “gives us a reason to live.”

Pointing to historical references offers no solace. We simply didn’t live that long and in many instances, if we didn’t succumb to disease or injury, the hardships of living a semi-industrial, semi agrarian life simply took its toll.  If you did make it to retirement, you became a burden on the family and on those around you. Death was a welcome exchange for a life well-lived – only, the vast majority would not have considered in such a way.

As we moved to the cities and away from the rural life, the idea of a throwing away an older person simply because they outlived their usefulness was seen as cruel and unusual.  Overcoming poverty was seen as the responsibility of a much larger family, the citizenry of this great and growing country as the best way to ensure that the end of a working life wouldn’t be spent begging for a meal. We had no intentions of making those years after you could no longer work leisurely; just tolerable.

The advent of Social Security became the best way to show our fellow citizens that we cared and understood the simple economics of life: if you don’t take care of the poor, they will cost you far more than they would if you had.  Elderly poor perhaps doubly so.  In all honesty, the ability to survive in comfort on a Social Security check is just not possible.  It may keep you from being poor, but only barely.

Pensions were created to breed loyalty and to help offset the government’s program of protecting the less fortunate workers.  Then, at some point, some accountant discovered a line in the tax code that would allow well paid workers with a pension to create even more wealth, while avoiding taxes.  And that instance was the beginning of the end.

Retirement became a purchase with the advent of the 401(k) which focused on the wealth a stock market could generate.  While pensions were a trade-off for human capital and Social Security became insurance against dire poverty, 401(k)s and IRAs turned into the only possibility for the vast majority of Americans to keep what they had worked so hard for.

While Mr. Johnston might be correct in suggesting that retirement is not an entitlement, each person’s personal journey is based on the dream that one day you will have earned the ability to step away from the daily grind, perhaps not because we wanted to but instead because we needed to.

Without a firm grasp on how old we might become or how much money we would need to survive a post-work career, retirement became a reward for a life well-lived, well-invested, and earned. What we are entitled to is the dream, the possibility and the hope.  Squashing that by suggesting that we have no right to do so is to remove the child-like wish for something that may be elusive, may not exist the way we had dreamt it might be and  above all, might not be possible.

We are entitled to dream. And if that dream is what keep us moving forward, then dream on.  But to dash it with crude realities, suggesting we are entitled to nothing is do a great disservice to the concept of hope.  Retirement is a new thing based on historical references. But it is not beyond our reach. It is certainly something worth hoping for and working towards.

We can dream and we are entitled to that.  If the dream is retirement, so be it.  As much as I fancy myself a realist, this dream, my dream, the dream  of millions of working Americans who believe that there is more to work, more to the employment we may not like, more to the toil that is taking a physical and mental toll on our enjoyment of that life, it is worth entertaining and that makes retirement an entitlement.

Related posts:

1. The Early Retirement Conundrum: Take it Now or Hope it will be there
2. Retirement Planning in the Age of Caveats
3. Your Retirement: Social Security Considerations
4. Women and Retirement: What Prudential Wants You to Believe
5. The Overly Prescribed Retirement: When Advice is Unsolicited

Tagged as: 401ks, conservative investments, entitlements, financial solvency, iras, poverty, retirement planning, social security, wealth effect