Florida condos, group bus trips and endless games of Solitaire may be a thing of retirement past. The typical American Millennial is unlikely to mirror the retirement of their grandparents — or even their parents. According to analysis in the publication Science, developed countries have seen an increase in longevity, more than two years every decade. A person born in 1998 is likely to live to 95, assuming she has reasonable access to education and healthcare. This means that your golden years might be almost as long as your professional life. Spending 35 years lounging by the pool or playing mahjong is unlikely to appeal to Millennials, who seem to prefer transience to routine.
When Social Security was first established in 1935, life expectancy was around 61. For those trying to fit in education, a family and a job to support that family, there wasn’t ample time for leisure and other activities. It’s no wonder then that Americans defaulted to a three-stage plan that focused on those three things. Adding an upward of 40 years to a lifespan frees things up bit to make life more fulfilling, and in turn, provides the opportunity for a “multi-stage life.” Coined by Lynda Gratton and Andrew Scott, authors of “The 100-Year Life,” the concept outlines the shifting of our life trajectory from being progressive and defined by three stages to one that’s non-linear and filled with diverse careers, breaks and adaptations.
“The current trends of this three-stage life cannot work for someone with potential to reach 100 [years of age],” says Scott, professor of economics at London Business School. “Instead, a multi-stage life will be made up of many different stages each with different aims — perhaps one aimed at making money, another with a better work/life balance or a third focused on self-expression. Each stage will require a reboot to prepare a new identity and skills for the stage ahead.”
Millennials are leading the way by redesigning their 20s as a distinct age stage. The focus: Spend your second decade determining your values, your strengths and priorities — a time to hold off on early commitments and explore ample possibilities.
A recent Merrill Edge Report shows that 42 percent of 18-to-34-year-olds designate working their dream job as a personal milestone. Thirty-seven percent make traveling the world one of their top priorities. And almost two-thirds of Millennials are saving to live out their desired lifestyle now, as opposed to 55 percent of Gen Xers and baby boomers who put money aside for retirement. Call it FOMO retirement planning: Younger generations are no longer looking at their adult life as a predetermined, linear path. Instead, they’re taking a hop-on-hop-off trolley approach by nurturing personal goals. Read on to see how you can catch a ride for this multi-stage life.
The multi-stage life counts on being adaptable in all areas: career, relationships, family and beyond. “Flexibility requires that we set aside what has already happened so that we can be open to what arises next,” says Henry Emmons, holistic psychiatrist and co-author of “Staying Sharp.”
Curiosity is an important driver in creating this flexibility. It challenges us beyond what we already know, which results in a bit of (good) stress that resolves when the related task is complete. Think about trying an exotic food. Inquisitiveness makes you wonder what it tastes like, followed by tension before you experience the unknown flavor, until your brain registers the entire experience as new taste. “As far as the brain is concerned, curiosity pushes us to keep going and thus, creates new neuropathways,” Emmons says. “It’s the best things we can do for ourselves, especially as we age and become set in our ways.”
Identity is often shaped by a particular job. When you’re not limited to a single career, however, you’re open to experiencing various roles. “You need to think about your identity in a different way,” says Scott. Reinforcing the idea that a gap year is no longer limited to college graduates, and instead, an acceptable (planned) exploratory period every few decades, is bound to reboot any inertia along the way.
Invest in New Skills
If you don’t disrupt the three-stage life, you’re likely to feel bored or frustrated during your centenarian life. “The human psyche needs to keep growing and learning,” says Emmons. “The antidote is to keep yourself engaged and try new things to create a sense of momentum that gets you out of a repetitive pattern.”
In order to stay current, one should be ready to adapt — and often. Unknown opportunities will arise a decade from now, so it’s vital to reskill every three to five years. Virtually every job today requires at least some computer skills, and those at the helm have a clear advantage. New technologies, like robotics and Artificial Intelligence (AI), will further disrupt the playing field. The International Federation of Robotics forecasts that the number of industrial robots will increase by 13 percent each year between now and 2019. According to the McKinsey Global Institute’s June 2017 report, “Artificial intelligence tools have the promise to change our lives as fundamentally as personal computers did a generation ago.” Because almost a quarter of firms that have adopted AI expect to grow their workforce, not reduce it, individuals need to acquire skills that work with, not compete, against machines.
This approach challenges the collegiate “learn then earn” model that can’t keep up with fast-paced job market. A “nanodegree” may be the answer to get ahead in this new digital frontier. Udacity, an online education hub, has pioneered the concept of offering tech-savvy courses — including Robotics and Self-Driving Car Engineer — that further one’s career without costing much time or money. These courses aren’t just useful for a Silicon Valley wannabes; the financial, media, retail, education and healthcare sectors, as well as the travel industry, are all integrating various degrees of AI into their frameworks.
While automation is the asset du jour, robots alone can’t monopolize the workforce. A perk of being human is that mental plasticity drives innovation and creativity. Take this success story: A computer science whiz was able to break into the L.A. fashion industry because her coding background allowed her to develop programs for printing patterns on different textiles. “She had the visions of a fashion designer, but also understood the mechanisms to bring her visions into reality,” says Valerie Streif, senior advisor with Mentat, a San Francisco-based organization for job seekers. “You’re able to jump fields as long as you’re willing to take on new challenges.”
It’s crucial to develop transferable soft skills such as leadership and communication — something the smartest robot cannot match. “Emotional intelligence is the most desirable soft skill of all,” says Streif. “The ability to read people sets you apart as a leader.”
Strive for a productive life
Planning for a multi-stage life is more than lining up your finances (more on that later). Family, friends, health, mental well-being and knowledge are the building blocks of an enjoyable long life. Aside from providing a nurturing day-to-day experience, these intangible assets are crucial during transition periods that often need extra support.
On the home front, actually coordinating and switching roles — a theory coined by Nobel prize-winning economist Gary Becker back in 1981— allows each partner to further develop different life stages while still maintaining the much-needed income stream. Domestic partnership roles based on traditional patriarchy simply can’t benefit both parties, not in the long-run anyway.
Much like financial investments, intangible assets like friendships need diversification and consistent attention to grow. (After all, you can’t bank on college to set you up with friends for the next 80 years). This is where volunteering, civil service or caregiving come in. Non-homogenous relationships make you less prone to stereotypes, prejudice and ageism — boosting your reputation as a people-person, a characteristic that carries enormous value in every day interactions and the workforce.
A productive life also means prioritizing a healthy mind and body. The healthier you are in your youth, the fewer chronic conditions should pop up later on. Conversely, an unhealthy lifestyle doesn’t just wreak havoc physically; it can drain savings due to the already volatile state of healthcare. If practicing meditation seems too advanced, develop good sleep patterns. “It’s the single most protective thing for the body and the brain,” says Emmons. Sleep is like going into a repair shop to tweak all those micro injuries that happen during the day. “Deep sleep allows the brain to cleanse itself and opens up channels that are closed during the day,” he adds.
Revamp your financials
According to a Bankrate.com report, seven out of 10 of non-retired Americans plan to work as long as possible during retirement. Of those, 38 percent plan to remain employed because they like to work, and 35 percent said they plan to have a job because they need the money; 27 percent said both. When you consider that a third of Millennials believe Social Security won’t be available to them, retirement savings must take priority. “Everyone, especially Millennials, should get in the habit of saving 15 percent of their income for retirement,” says Greg McBride, chief financial analyst at Bankrate.com. “Ideally through tax-advantaged retirement accounts such a workplace 401(k) and an IRA. Establish this habit early on and it will stick with you as earnings grow.”
In fact, you might need to stash as much as 25 percent of your income — a challenging task if student loans and travel eat up a saving than previous generations.
While Millennials are better at saving than previous generations, the Great Recession has made many question the security of investment plans. The fear is not warranted, says McBride. “Who cares what the market does next year, or the year after. You’re making contributions. If the market goes down, you get better price on your next contribution. The stock market is the only place, when it goes on sale, people run the other way.”
But what about paying off student loans? A fair question given the fact that 70 percent of college graduates are left with $38,000 in debt, on average. While a looming loan can be psychologically burdensome, making consistent payments towards your loan for 10, or even 25 years if you’re furthering your education, is often the right plan, particularly if you’re also paying a mortgage or other debt. Contributing to a 401(k), particularly if your employer offers dollar-for-dollar matching, is another smart alternative to paying off student loans right away.
“We don’t yet know what exactly works over 100 years, and it will be a long while until we do,” says Scott. That’s why it’s a good idea to ignore the clock a bit. Your 20s are becoming increasingly accepted as a time to be liberated and to transform your interests into more permanent sectors of your life, such as different careers or lifestyles. Think of your 30s as the test-drive decade for all those self-discoveries made during the previous decade. Perhaps your 40s is a time to make tweaks or shift gears. Once you’re in your 50s, ponder whether your older self will approve of how you’re setting up your life for the next stages. “Unlike past generations, it’s important to keep giving yourself options throughout all ages,” says Scott. “You find out what you like by both doing it and by rejecting what you don’t.”
The advantage of looking at life as a non-linear progression frees you up to make choices that may otherwise feel risky when you’re bound by the expectations of the three-stage life. Millennials are on the right track by delaying marriage and children in order to make time for self-discovery, find well-fitting careers and partners and enhance their community.
Going forward, each person has the opportunity to create a unique path. But to do so, we have to become age-agnostic. Repeat the following: Age does not equal stage. In other words, there are no rules when you can be a college student or a spouse, or hold a certain job. Overthinking whether you fit into a mold can be detrimental in the long run. “Worry and fear lock us in and create a sense of stagnation,” says Emmons.
This post is paid for by AARP.