Part 2 of our narrative on the benefits of an Encore Career
Many of us put our dreams and hobbies on the backburner for all kinds of understandable reasons – a job that will pay the mortgage or put the kids through college, to carry on the family business or to pay off debt, for example. For those who love what they do, an encore career offers them the chance to keep on going, albeit at a slower pace. For others, maybe the career you chose when you were 20 was the wrong one, or maybe after 30 years you simply want to try something else.
In Part 1, we looked at how increased life expectancy means people often need, or want, to work longer. Rather than a longevity risk of outliving your money, however, we stress that the end of the traditional retirement model be seen for what it truly has the potential to be for you, a longevity opportunity. Not only can working longer offer crucial health benefits associated with staying active, it can also keep you engaged and stimulated in whatever brings you daily meaning and purpose. Or, it can present a chance to reinvent yourself and how you spend your time.
Dreamed of making and selling jewelry but were bound by a legal career? If our 70s are the new 50s, you have time to make that a reality. Technology and the prevalence of working from home only increase these types of opportunities. Put it another way, you could have all the money in the world but, if you retire at 65, what are you going to do for the next 30 or 40 years? What are you retiring to? In Part 2, we explore how this can, contrary to what many think, can be an exhilarating time of life.
A second chance to shine
As Andy Dufresne in Shawshank Redemption famously said, you “either get busy livin' or get busy dyin.” Now, to be clear, no one is viewing your first career as a prison sentence (although maybe it felt like it) but Dufresne, of course, was speaking to Red, played by Morgan Freeman, who knows only too well the power of a late encore career. Freeman served in the United States Air Force before becoming a dancer and didn’t get his big movie break until he was in his 40s. And he’s not alone in the celebrity world for chasing dreams when others are thinking of retirement. Vera Wang was a national-standard figure skater, then editor of Vogue before she became a renowned bridal wear designer, while Canada’s Leslie Nielsen was a radio DJ in Calgary before Airplane! hit the theatres when he was a sprightly 54! Screen great Kathy Bates worked numerous jobs, including as a museum cashier, before her big Hollywood break came in Stephen King’s Misery.
But it’s not just the rich and famous who are re-energised by an encore career.
For example, a specific client of ours, let’s call her “Client A” was an executive in a tough industry. After we helped her to navigate her severance, financially, she wasn’t ready to retire and getting back into marketing in your late 50s is tough, so what next? After some calculations, it was clear she didn’t need to earn as much as she thought if she could just slow the bleed on her assets by just $20-25,000 a year. It doesn’t matter that she won’t continue earning six figures, she already has wealth, but now she doesn’t have the same obligations and pressure.” So, with a passion for her own home garden, and some clarity from the ETF Capital Management Financial Life Strategy Team, she simply moseyed over to her local garden store and applied for a part-time job. Now. She gets to be engaged in her favourite hobby all day long, earning a tidy sum when combined with the income from her investments…and enjoys a healthy employee discount as well. Could she have pursued something like this when she and her husband were servicing a mortgage and educating their children? Probably not. But with those heavier burdens behind her and a stipend produced by her accumulated wealth, Client A has an opportunity to enjoy something that speaks to her.
Some of the retired population are affected by what they feel is a lack of purpose when they leave the workforce, while they might also feel lonely without daily social engagement. These two combined, it’s been proven, are detrimental to your physical and mental health. For people in their late 60, and throughout their 70s, who crave intellectual and/or social stimulation, an encore career might be the answer. The mortgage is ideally paid off and you no longer rely on bringing home a set amount of dollars every month. Instead, you are fully in the financial driver’s seat. This, in turn, gives you choice.
This was the scenario for Client B. One half of an affluent couple in her 70s, she didn’t need extra income but was straight up bored. After busy careers, neither husband or wife were used to spending so much time together and wanted time apart to do their own thing. So, she got a job at Starbucks as a cashier and loved it because she gets to talk to people all day, many of whom she knows, and feels involved in the community.
You’re richer than you think
For both Client A and Client B, their encore careers keep them active, youthful and engaged. And it’s hard not to conclude that this will also extend their lifespan. Embracing new jobs and opportunities when you’re older is often more about being an engaged member of the community and being stimulated by your environment.
Think of yourself as a time billionaire, a phrase coined by the co-founder of East Rock Capital, Graham Duncan. One million seconds is 12 days and one billion seconds is 31 years, a typical career. Time is our greatest asset, yet most of us want to rush through to various milestones before the clock stops. By viewing the changing retirement landscape as a longevity opportunity to reinvent yourself and your days, you are probably richer than you think by millions, maybe even a billion. If you can change your mindset to embrace that extra time and have an encore career, whether that’s a passion project or getting involved in the community, your mind, body and wallet will be in a healthier place.
