Smart Investor Malaysia


The Future of Retirement?


Retirement, is defined as the ending of working phase in life, which is anticipated to be one that is dominated by leisure that is paid for by savings and benefits accumulated during the employment phase. This is how most investment companies sell retirement plans ideas anyway.

There seems to be a great divide of lifestyle – before and after retirement period.  But most people who have experienced the shift would tell you otherwise, especially as we journey into the future with increased longevity, greater responsibilities, eroding filial piety, shifting attitudes and different economic landscape.

The idea of retirement would be rather different, say by 2050. I would think that in the future, the younger cohorts may not know the word retirement, either due to circumstances or by choice.

Stop Working? No Way!

“Oh I don’t plan to retire. I’ll work till I die. It’s more fulfilling.”

This is a phrase we hear increasingly often nowadays. Unfortunately, this may soon be a reality for many of us, as the sociographic landscape is bound to evolve in years to come.

The societal acceptance of single living or family without kids has dropped birth rates historically low, causing our projected population to be made out of a growing number of the elderly.

This would undoubtedly affect our dependency on the older generation to contribute to the workforce. Coupled with the increase in retirement age following the increase in life expectancy in the next 30 years, we would have no choice but to let the elderly continue working for the betterment of our economy.

Work? Leisure? Why Not Both?


Friedmann and Havighurst who first defined the concept of retirement  which we think of today, in a 1954 research found that people at that time viewed retirement as a time that they could truly engage in leisure activities and that their working age was the period of time to save towards this end.

However, fast forward to today and towards the future, when general standard of living increase and leisure becomes more accessible and affordable, not to mention more varied, we tend to enjoy both work and leisure at the same time.

This makes the concept of retirement seems less convincing and attractive. In the past, people did not see work and the workplace as central to their life interests.

Today, as the pace of economic growth quickens, we look at our career as being central to our lives, and as work and leisure become inextricably interwoven, Friedmann and Havighurst’s idea of retirement as a discrete phase of life dedicated to leisure becomes less relevant.

Blessed With Longevity

With progress in medical treatments and the rise of health-conscious lifestyle through better awareness, an extended life expectancy can be expected.

There is a high probability that life expectancy will continue to increase in industrialised countries in the Americas, Australia and the Asia- Pacific. Already, the average life expectancy will increase in many countries by 2030 – with South Korea expected to exceed 90 years of age. (Source: A 2017 analysis by Imperial College London and the World Health Organisation)

As life expectancy increases, people are also living healthier lives both physically and mentally, and being “too old” to work may seem to come much later in life than anticipated.

Some would argue that the elderly would become irrelevant due to technological knowledge demands. We might be able to say this about the elderly of yesteryear, but it certainly would be different for current generations which grew up with technology and the Internet of Things, and whose lives are being intertwined with technology whether they like it or not.

Shifting Attitudes – Do You Even Want To Retire?


As jobs turn into careers and knowledge or experience is prized over physical labour, we value our contributions to the society.

With mundane jobs and repetitive tasks are replaced by technology and artificial intelligence, our society in the future would be left with nothing but intellectual jobs.

Having to stop working all of a sudden would certainly leave a gap in a person’s purpose in life, especially when filial piety is on a downtrend as well.

As we crystal-ball into the future, the very idea of retirement may seem invalid as people would continue working until they are mentally incapable. Indeed, the very idea that a person stops working and becomes irrelevant to society does not sound like a very appealing thing to do.

Do You Still Need Financial Planning?

With all that said, having a financial plan will allow you to successfully not retire. Financial planning is far more expansive than just “save for retirement.” There’s a lot of life to live between now and when or if you decide to stop working.

There are plenty of other short-term goals and milestones in your life that you likely want to hit – starting a new venture, growing your family or buying a new home and traveling around the world. And financial planning provides a system and a process to make some of these goals possible.

About the Author

Alvin Kwan, CFP CERT TM is the executive director and head of financial planning at Redvest Wealth & Asset Management. He has over 12 years industrial experience in the financial industry, specifically in wealth advisory, private banking and stock broking. He was also a lecturer in areas of investment management, derivatives, and financial markets.

We at Smart Investor and Redvest is committed to help you better manage your financials. Get a free consultation from an expert by filling in your details here:

Join our Telegram to get the latest from Smart Investor

Recent Posts

Related Posts

Smart Investor Newsletter

Get Our Latest Articles And More Delivered To Your Inbox!