INTRODUCTION
LETS GET READY TO RETIRE
5
With all the changes
that have happened
in the world, it's no
wonder that the
retirement landscape
has shifted
dramatically. Take,
for example, my
Grandfather
(Grandpa Mick) who
retired in 1997 at the
age of 66. Although
Grandpa's career
and retirement were
typical during that
time, for many of
today's pre-retirees it would be atypical.
For instance, in 1980, at the peak of Grandpa's working career,
38% of workers had a pension. Today, less than 15% of workers
have a pension plan and that number is shrinking daily.
1
Careers
also tended to be more stable during Grandpa's working years.
He worked for the same company for 33 years before retiring.
Compared to today, where the average worker
switches jobs 12 times during their career
2
.
If declining benefits and an unstable job
environment aren't bad enough, the investing
landscape is also arguably much more difficult.
In January of 1997, AAA Corporate Bonds were
being issued at a 7.42% interest rate. If a
retiree chose to, they could purchase a portfolio
of highly rated bonds and earn in excess of 7% a year with very
little risk. As of June 2018, the same retiree would be earning just
over half that amount (3.96%) with the same strategy.
3
"Today, less than
15% of workers
have a pension plan"
1
. https://www.fool.com/investing/2018/06/05/pensions-are-disappearing-heres-how-to-save-for-re.aspx
2
. https://www.thebalancecareers.com/how-often-do-people-change-jobs-2060467
3
. https://fred.stlouisfed.org/series/AAA
