Seniors playing cards and having fun in their retirement home
(Credit: Visoot Uthairam / Getty Images)

The new retirement means a new life chapter, but few retirees have prepared for that final chapter, according to a new study.

“Longevity and the New Journey of Retirement,” released Wednesday from Age Wave and Edward Jones, explores the changing definition of retirement, the four stages of the “new retirement,” and how they track within the Four Pillars of the New Retirement: health, family, purpose and finances.

According to the study of more than 11,000 adults, Americans still want to live longer, with almost seven in 10 (69%) saying they want to live to 100, despite worries about healthcare and long-term care costs. And they want to spend that extra time with family and friends (35%), enjoying life (23%), seeing what the future holds (19%) and doing more (18%). 

Some indicated they would not want the extra longevity if they were in “terrible health” (32%), if they became a burden to family (29%), if they had cognitive issues, including Alzheimer’s disease (20%), or if they had no purpose in life (14%).

Not your parents’ retirement

The definition of retirement is changing, and retirees now say the ideal length of retirement is 29 years. 

Pre-retirees and retirees view their parents’ version of retirement as a time for rest and relaxation. Only 27% of today’s retirees view retirement similarly, and 55% define retirement as “a new chapter in life.”

“Today’s retirees enjoy a growing array of opportunities to stay engaged, possibly reinvent themselves and enjoy the freedoms of this stage of life,” Edward Jones Principal of Branch Development Ken Cella said. “At the same time, they face new challenges, especially around their health, their finances and finding a new definition of purpose.”

There also isn’t a clear line marking retirement. Only 34% view stopping full-time work as the start of the retirement chapter, whereas 22% mark it by receiving Social Security or a pension, and 17% mark it by achieving financial independence. Only 10% defined retirement as reaching a certain age. 

And when it comes to retirement plans, 59% said they want to work in some way; 22% want part-time work, 19% said they hope to cycle between work and leisure, and 18% want to work full time.

Retirement stages and journeys

The new retirement journey unfolds into four distinct stages, according to Edward Jones Senior Investment Strategist Mona Mahajan:

  • The anticipation stage, up to 10 years before retirement, includes people focused on their careers, raising families or caring for loved ones. This group, Mahajan said, is particularly uncertain about finances and health. 
  • People in the liberation / disorientation stage, up to two years after retirement, struggle to find a sense or purpose and how to organize their time and finances. 
  • The reinvention stage, three to 14 years after retirement, is considered the “heart of retirement.” Those individuals, she said, have hit their stride, figured out who they are, and are exploring new experiences while enjoying old ones. 
  • The reflection / resolution stage, 15 or more years after retirement, is what Mahajan called the “happiness enjoyment phase.” People at this stage are living comfortably within their means, looking forward to the years ahead and focusing on their legacies.

Despite wanting to leave a legacy, few retirees have prepared to do so through wills, powers of attorney or healthcare directives, according to the research. AgeWave founder and CEO Ken Dychtwald said that part of the problem is, there isn’t a boot camp, summer course or training earlier in life to put retirement planning higher on the list of priorities.

The data, according to AgeWave and Edward Jones, revealed four retirement journeys:

  • Purposeful Pathfinders were defined as happy, engaged, productive and contributory. They began saving for retirement earlier than most other groups, with 78% saying they are in great shape financially.
  • Relaxed Traditionalists pursue a more traditional retirement of rest and relaxation. Most (81%) retired on their terms. Although they are open to relocating — including to senior living communities — they have few aspirations for personal growth or giving back to society.
  • Challenged Yet Hopefuls lead active lives and are focused on self improvement, but their futures are uncertain due to financial constraints. Half said they worry about outliving their money. Members of this group began saving for retirement later than all other groups, and 54% with retirement accounts said they made early withdrawals along the way.
  • Regretful Strugglers are the least prepared for retirement, are the most unhappy and overall and feel the least positive about life. The majority (59%) said they have regrets, 43% said they are financially worse off in retirement than during their working years, and 42% said they feel as if life dealt them a bad hand.

Dychtwald said that patterns emerged across those doing well in retirement — they actively maintained their health, were more socially engaged, found their purpose in life and were more mindfully involved with their financial strategy and management. 

“Retirement continues to evolve rapidly under converging forces, such as longevity, generational flow, health and wealth,” he said. “Retirement is becoming a new, substantially large chapter in life, with the potential of being an active and enjoyable journey or difficult, challenging and unfortunate period of life.”

The study consisted of a three-day forum, online focus groups and online surveys conducted by The Harris Poll of 11,000 adults from the United States and Canada who were retired or within 10 years of retirement.