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Rework Your Financial Goals for the Better by Planning Not to Retire

Money problems were prevalent even before the pandemic, but the outlook has worsened for more Americans since 2020. Roughly half of active employees report increased difficulty with meeting their financial goals. In particular, they foresee having to delay their retirement to ensure long-term financial stability.

When it comes to money management, there’s no shortage of advice to be found. You can consult sources ranging from financial experts and their books and podcasts to the motley assortment of blogs and posts on social media.

But is it really a good idea to foist the burden of financial improvement entirely on the individual’s shoulders?

The one skill you need

The challenge of doing better with one’s finances can seem daunting. But there are complex aspects to it, as well as simple, low-hanging fruit.

The latter includes best practices, such as setting a household budget and adhering to it or making sure to pay off outstanding debt as soon as possible. Money hacks, such as only carrying cash in your wallet, cutting up your credit cards, or setting up automated transfers from your paycheck to savings, also fall into this category.

Yet the easy aspects of financial management often address only part of the puzzle. If you want to make real progress, you also have to learn how to navigate a world of financial products.

With mortgages, for instance, one size doesn’t fit all. Aiming for a conventional mortgage when you haven’t considered USDA loans might leave you overlooking a more flexible and appropriate option for living in the country. Want to invest? Again, you’re presented with a breadth of options, from the familiar 401(k) and CDs to stocks, bonds, ETFs, and mutual funds.

When you hear exhortations to get your finances in order, what these people are really saying is: learn the skill of financial literacy. It’s the umbrella term for mastering all that money knowledge.

Facing other barriers

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Yet the problem is, literacy alone doesn’t guarantee participation in financial markets. It doesn’t translate to building wealth. You need higher levels of education and cognitive ability as well, which amplifies the effects of inequality. The same people who’re likely to have money problems are also less likely to have higher educational attainment.

Moreover, while developing literacy is a significant step forward, it isn’t the only barrier to financial success.

Inequality, as previously mentioned, tends to exacerbate money problems. Marginalized groups must work harder to gain sound financial footing than the average person who’s also seeking to improve their finances.

Since our education system is supposed to build students’ career and life skills, schools could help teach personal finance. However, these institutions may not currently employ qualified personnel, making it a costly change to mandate.

Not every government is willing to invest time and funds in adding financial literacy to the curriculum, so the consumer foots the bill. You get the education you pay for and are more likely to receive instruction in personal finance if you can afford a top school or pursue a college degree.

Financial institutions and professionals are obstacles individuals can’t control. We trust our bankers, but we don’t fully understand their products. That creates the potential for predatory practices or exclusion, such as when people are denied lines of credit because of how a biased algorithm profiles them.

The end of retirement

The promise of financial literacy lies in its simplicity. As complex as money matters seem to be, if you devote yourself to learning this one skill, everything will eventually fall into place.

Yet as we’ve seen, that isn’t true. Individual efforts can’t always overcome institutional barriers or deeply entrenched inequality.

It’s time to reframe the ultimate purpose of our efforts at improving personal finance. Are we really supposed to make a living under the model of setting aside some money for eventual retirement?

If you think about it, the cost of living only increases. The value of money, when poorly or not invested, depreciates due to inflation. That’s what makes it so hard for most people to actually manage to save enough money in the long term.

But why is it our goal to stop working, and therefore earning, by the time we reach some arbitrary age?

Average life expectancy is longer, and many people are still capable of being productive in their 70s and 80s, or even beyond, due to good physical and mental health. Continuing to work can give seniors purpose and meaningful social interactions that tend to dwindle if they retire.

Stop planning to retire, and you won’t feel the pressure to build wealth that’s sufficient to cover over two decades’ worth of expenses in your old age.

Just focus on the process of balancing the books. Never stop searching for work that makes you satisfied. Continue to be productive for as long as you can, and enjoy making a living.

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