A World With Most in a Work Optional State

People who reach a comfortable retirement have savings, assets and investments that enable them to pay for their spending without being required to work. Financial institutions and governments have described this as an achievable and desirable state for most of the middle class. It was generally argued that it was a crisis that people would become elderly and still need to work to pay for their expenses. A typical statistic quoted would be that 64% of people are not prepared for retirement. Flipping this around, this means that 36% of people are prepared for retirement and some are in a position for early retirement. The typical target ages are 65-70 for an on-schedule retirement. If people are 20-25 when they start serious careers then they are achieving a comfortable retirement in 35 to 50 years through work, savings and investment.

Many European countries have high rates of people successfully reaching retirement or a work optional state. The savings rate can be higher and the medical system and elder care systems can be nationally structured where there is never the risk of large financial payouts for any medical procedure or for elder care costs where the nursing costs are paid for by the elderly or their families.

36% of Japan’s population is projected to be over the age of 65 by 2050 and 48% over the age of 55 by 2050.

About 25% of people in the USA have voluntary early retirement before the age of 62.

Over 4.5 million people have followed a trend toward living without debt. Radio host Dave Ramsey promotes a simple approach to budgeting and choices to enable even people with low incomes to pay off all of their debts.

38% of Millenials are saving for retirement. This is higher than previous generations. There is a trend for better investment knowledge and more aggressive savings and investment.

Retail investors have had below-average market returns. They have typically been getting 5.19% annual returns instead of the 9.85% annual returns of the SP500.

The Millenial investment trend, mass financial education, and more optimal structuring of national medical systems and pension systems would enable the vast majority of people to reach financially secure retirement at the age of 60.

People are living healthy and active lives for 15-20 years after the age of 65. Asian American Women in New Jersey have a life expectancy of 93 years. People living healthy and active lives up to 100 within thirty years seems assured with just moderate success with antiaging science and medicine. The other factor would be that the following generation of families after the first generation reaches financial security would have a financial boost. Financially secure parents would be able to provide initial down payment for a property or other assistance.

This would mean most people working from 20-60 and then being in a work optional retirement from 60-100.

Any improvements in financial management, investments, antiaging would boost the number of people in a work optional, financially secure state beyond 50%.

Asia is catching up to America, Japan and Europe in per capita wealth. Longer-term after 2050, the world would be trending from 15% comfortably retired or early retired towards 50% possibly as early as 2100. The definition of early retired and having over half of one’s life optionally working would expand with longevity improvement.

SOURCES – Ramsey, Schroders, Wikipedia, The Balance
Written By Brian Wang, Nextbigfuture.com