You say you want a revolution

Is it any surprise that Baby Boomers are redefining retirement? Let’s face it—we should have seen this coming. After all, the Boomer generation has been like the proverbial pig through the python of American culture, redefining each life stage along the way. Education, work, politics, relationships, parenting, consumerism, communications, exercise, entertainment and religion have been “Boomerized,” for better and for worse.

The sheer size of this generation was bound to have an impact. Like a tidal wave, it has accelerated cultural changes on its journey toward the shore. Now Boomers are at the threshold of retirement, and they are beginning to change that, too. But for most Boomers, doing retirement differently than their parents will be driven not by their personal initiative or individual choice as much as by the following four factors:

• Actuarially, this generation will, on average, live longer than any previous generation—which means that a period of retirement starting in a person’s 60s could last for 20 to 25 years, nearly double the average retirement of recent generations.

• The size of the Baby Boomer generation is expected to strain Social Security and Medicare to the point where these benefits will continue to be reduced.

• Employer-provided pensions and retiree medical benefits are already on the decline and will continue to disappear as employers come to terms with their inability to actually pay these benefits to such a large group of retirement eligible employees.

• Boomers have done many things well, but accumulating personal savings isn’t one of them. We can blame this on numerous obstacles Boomers have faced, but the driving factor for poor savings behavior is the evolution of credit. Baby Boomers were the first generation to have large amounts of readily available credit at their disposal throughout their adult lives.

The bottom line? The retirement revolution isn’t coming from the inside out, but from the outside in. Longer life, lower benefits and lack of savings will be the real incentives for Boomers to reinvent retirement, no matter how the talk show pundits, authors and experts attempt to dress it up. This retirement revolution isn’t about choice—it’s about necessity.