To Grind or Not to Grind?

I can’t believe it’s already May. This year has been zipping right along and, as some of the pandemic concerns appear to be waning, people are starting to get optimistic about the rest of 2021. Let’s hope that lasts!

With the past year or so being tough in many ways this recent surge of optimism is leading some to take the leap and retire early. Life is waiting out there, they think, and restarting after a year-plus of living on hold may be the perfect catalyst for major change. For these folks, going back to the same old grind just doesn’t seem that appealing.

Retiring early is complicated from a financial planning perspective, but it can be possible with some creativity. Or maybe creativity mixed with a sense of adventure. The definition of retirement is changing. In short, you can define it however you want. Is now the right time for you? Of course I can help with the financial part of that, but the bigger “What does retirement mean to me?” question is something only you can answer.

This week I wanted to share a couple different stories centering on this theme of bucking convention and retiring early. What’s interesting is the age spectrum being reported on lately. The first story covers who you’d think of as more typical early retirees while the second, perhaps surprisingly, looks at much younger folks who are planning to “retire”.

Here are big portions of each article and I’m including links if you’d like to read each in full.

Continue reading…

After a year of early-morning Zoom calls, the specter of a deadly virus and soaring stock and real estate values, working American baby boomers who can afford it plan to get out while the getting’s good.

About 2.7 million Americans age 55 or older are contemplating retirement years earlier than they’d imagined because of the pandemic, government data show. They’re more likely to be White, a group that typically has a larger amount of accumulated wealth, and many cite robust retirement accounts and Covid-19 fatigue for their early exit, according to interviews with wealth managers and federal surveys.

Much like the U.S. economy’s so-called K-shaped recovery, the pandemic is treating the affluent differently, empowering them to leave corporate life early. Others who lost jobs had to delay retirement, or grew discouraged and retired before they were ready.

In the Minneapolis area, Craig DiLorenzo, 58, is among those who chose to bow out, after a career at industrial giant 3M Co. Frustrated over 6 a.m. teleconferences, his thoughts turned to spending more time pursuing his outside passions, including volunteering with the Salvation Army. A scare with cancer five years ago made him reconsider his commitment to climbing the corporate ladder, and the last year stuck at home only reinforced those feelings, he said.

“It makes you think, ‘Does all this matter as much as you think it does?’” said DiLorenzo, who retired at the end of March.

DiLorenzo’s cohort is one better known for hanging onto their jobs as long as possible, usually retiring later than their European counterparts. Their potential exodus from the corporate world, combined with a sharp increase in the number of business owners seeking to retire sooner than they anticipated, is a worrying phenomenon for companies that rely on their accumulated expertise. In addition, burnout among older physicians and teachers is pushing some to an early exit, threatening shortages in health care and education.

Financial advisers say they’re seeing a new “life-is-short” attitude among clients with enough money socked away to carry them through retirement.

The prospect of going back to the daily grind is going to be “a really tough pill for a lot of people to swallow,” said Kenneth Van Leeuwen, founder of financial services firm Van Leeuwen & Co. in Princeton, New Jersey.

One client, an executive whose stock portfolio has performed well, is retiring at 48 as the prospect of having to go back to traveling 10 to 12 nights a month isn’t appealing anymore, Van Leeuwen said.

Forty miles west of Boston, Melissa Marteney got tired of working more with less as the pandemic dragged on. She helped oversee state parks for the Massachusetts Department of Conservation and Recreation and was tasked with hiring hundreds of lifeguards and other seasonal workers each spring. But even as people flocked to parks to escape Covid-19 lockdowns, the state cut the seasonal administrative staff that helped her screen candidates.

She retired this year at 58, about five years earlier than expected. Her husband also retired from his job at a financial services firm, and now the couple plan to sail to the Caribbean over winters in their 42-foot (12.8-meter) sailboat. By exiting early, she’ll collect a smaller payout from her pension, but the couple’s other retirement accounts have ballooned so much lately that “we’re going to be in the green until I’m 92.”

“I've seen so many people who have decided to wait too long to retire — many of my colleagues or older family members — and they get one year of retirement and get sick and pass on,” she said. “I don't want that.”

A November study from Pew Research Center found a surge in the number of baby boomers, those born between 1946 and 1964, who reported being retired compared to previous years — 1.2 million more than the historical annual average.

Other datapoints back up the findings. The number of people expecting to work beyond age 67 fell to a record low of 32.9% last month, according to a New York Federal Reserve survey. And about 2.7 million workers age 55 and older plan to apply early for Social Security benefits — almost twice as many as the 1.4 million people in the same age group who anticipate working longer, according to a recent U.S. Census Bureau survey. 

The unprecedented surge in shares and home values during an economic crisis is easing the retirement path for those who have investments. Assets for Americans ages 55 to 69 rose by $4.2 trillion in 2020, including a $2.2 trillion increase in corporate equities and mutual fund shares and a $250 billion gain in the value of private businesses, according to data from the Federal Reserve. Real estate assets soared by almost $750 billion for this group. 

Concern that some or all of that wealth could evaporate has especially weighed on entrepreneurs who’ve been through the 2008 Great Recession. The number of business owners who say they plan to retire sooner than expected has doubled since last August, according to a survey by financial services firm Wilmington Trust.

“Dealing with two major economic events in less than 15 years may have them wondering if it’s time to take money off the table, especially as they near retirement,” said Stuart Smith, a national director of business value strategies at Wilmington Trust.

The loss of older workers will hurt the labor market. Those workers have strong productivity, lower absenteeism and they can train and mentor newcomers, said Susan Weinstock, vice president of financial resilience programming at seniors advocacy group AARP in Washington, D.C.

“Older workers are especially strong in soft skills — things that develop over time and are difficult to teach,” she said.

The situation could become particularly acute in health care. Almost a third of physicians are over 60, the nonprofit Physicians Foundation said in a November paper, warning that burnout threatens to exacerbate an existing shortage, especially among scarce specialists.

In Bethesda, Maryland, orthopedic surgeon Stephen Rockower, while not young at 69, retired earlier than planned last summer after the pandemic scared away many of his patients.

“I realized that whenever things did turn back around, I didn’t have it in me to fight to build the practice back up,” he said. “If I were 45 years old, I would have had to do this, but at 69 I said, ‘I don’t have to do this anymore.’”

Something strange is happening to the exhausted, type-A millennial workers of America. After a year spent hunched over their MacBooks, enduring back-to-back Zooms in between sourdough loaves and Peloton rides, they are flipping the carefully arranged chessboards of their lives and deciding to risk it all.

Some are abandoning cushy and stable jobs to start a new business, turn a side hustle into a full-time gig or finally work on that screenplay. Others are scoffing at their bosses’ return-to-office mandates and threatening to quit unless they’re allowed to work wherever and whenever they want.

They are emboldened by rising vaccination rates and a recovering job market. Their bank accounts, fattened by a year of stay-at-home savings and soaring asset prices, have increased their risk appetites. And while some of them are just changing jobs, others are stepping off the career treadmill altogether.

If this movement has a rallying cry, it’s “YOLO” — “you only live once,” an acronym popularized by the rapper Drake a decade ago and deployed by cheerful risk-takers ever since. The term is a meme among stock traders on Reddit, who use it when making irresponsible bets that sometimes pay off anyway. (This year’s GameStop trade was the archetypal YOLO.) More broadly, it has come to characterize the attitude that has captured a certain type of bored office worker in recent months.

I started hearing these stories this year when several acquaintances announced that they were quitting prestigious and high-paying jobs to pursue risky passion projects. Since then, a trickle of LinkedIn updates has turned into a torrent. I tweeted about it, and dozens of stories poured into my inboxes, all variations on the same basic theme: The pandemic changed my priorities, and I realized I didn’t have to live like this.

Brett Williams, 33, a lawyer in Orlando, Fla., had his YOLO epiphany during a Zoom mediation in February.

“I realized I was sitting at my kitchen counter 10 hours a day feeling miserable,” he said. “I just thought: ‘What do I have to lose? We could all die tomorrow.’”

So he quit, leaving behind a partner position and a big-firm salary to take a job at a small firm run by his next-door neighbor, and to spend more time with his wife and dog.

“I’m still a lawyer,” he said. “But I haven’t been this excited to go to work in a long time.”

Olivia Messer, a former reporter for The Daily Beast, also quit in February, after realizing that a year of covering the pandemic had left her exhausted and traumatized.

“I was so drained and depleted that I didn’t feel like I knew how to do my job anymore,” she said. So Ms. Messer, 29, announced her departure and moved from Brooklyn to Sarasota, Fla., near her parents. Since then, she has been doing freelance writing as well as pursuing hobbies like painting and kayaking.

She acknowledged that not all people could uproot themselves so easily. But she said the change had been restorative. “I have this renewed creative sense about what my life could look like, and how fulfilling it can be,” she said.

If “languishing” is 2021’s dominant emotion, YOLOing may be the year’s defining work force trend. A recent Microsoft survey found that more than 40 percent of workers globally were considering leaving their jobs this year. Blind, an anonymous social network that is popular with tech workers, recently found that 49 percent of its users planned to get a new job this year.

“We’ve all had a year to evaluate if the life we’re living is the one we want to be living,” said Christina Wallace, a senior lecturer at Harvard Business School. “Especially for younger people who have been told to work hard, pay off your loans and someday you’ll get to enjoy your life, a lot of them are questioning that equation. What if they want to be happy right now?”

Fearful of an exodus, employers are trying to boost morale and prevent burnout. LinkedIn recently gave the majority of its employees a paid week off, while Twitter employees have been given an extra day off per month to recharge under a program called #DayofRest. Credit Suisse gave its junior bankers $20,000 “lifestyle allowances,” while Houlihan Lokey, another Wall Street firm, gave many of its employees all-expenses-paid vacations.

Raises and time off may persuade some employees to stay put. But for others, stasis is the problem, and the only solution is radical change.

“It feels like we’ve been so locked into careers for the past decade, and this is our opportunity to switch it up,” said Nate Moseley, 29, a buyer at a major clothing retailer.

Mr. Moseley recently decided to leave his $130,000-a-year job before June 1 — the date his company is requiring workers to return to the office.

He created an Excel spreadsheet called “Late 20s Crisis,” which he filled with potential options for his next move: Take a coding class, start mining Ethereum, join a 2022 political campaign, move to the Caribbean and open a tourism business. He looks at it regularly, he said, adding new pros and cons for each option.

“The idea of going right back to the pre-Covid setup sounds so unappealing after this past year,” he said. “If not now, when will I ever do this?”

Disillusioned workers with money to spare have always gone soul-searching. And it’s possible that some of these YOLOers will end up back in stable jobs if they spend through their savings, or their new ventures fizzle. But a daredevil spirit seems to be infecting even the kinds of risk-averse overachievers who typically cling to the career ladder.

In part, that’s because more people than ever can afford to take a risk these days. Stimulus checks, enhanced unemployment benefits and a stock market boom have given many workers bigger safety nets. Many sectors now face severe labor shortages, meaning that workers in those fields can easily find new jobs if they need them. (Not all of these are high tech; many restaurants and trucking companies, for example, are struggling to fill open jobs.) U.S. job openings rose to a two-year high in February, and economists and business owners expect more turnover in the months ahead, as workers who stayed put during the pandemic start emerging from their bunkers.

“Lots of things were on hold during the pandemic,” said Jed Kolko, the chief economist at “To some extent, we’re seeing a year’s worth of big life changes starting to accelerate now.”

In addition to the job-hopping you’d expect during boom times, the pandemic has created many more remote jobs, and expanded the number of companies willing to hire outside of big, coastal cities. That has given workers in remote-friendly industries, such as tech and finance, more leverage to ask for what they want.

Individual YOLO decisions can be chalked up to many factors: cabin fever, low interest rates, the emergence of new get-rich-quick schemes like NFTs and meme stocks. But many seem related to a deeper, generational disillusionment, and a feeling that the economy is changing in ways that reward the crazy and punish the cautious.

Several people in their late 20s and early 30s — mostly those who went to good schools, work in high-prestige industries and would never be classified as “essential workers” — told me that the pandemic had destroyed their faith in the traditional white-collar career path. They had watched their independent-minded peers getting rich by joining start-ups or gambling on cryptocurrencies. Meanwhile, their bosses were drowning them in mundane work, or trying to automate their jobs, and were generally failing to support them during one of the hardest years of their lives.

Not every burned-out worker will quit, of course. For some, an extended vacation or a more flexible workweek might quell their wanderlust. And some workers might find that returning to an office helps restore balance in their lives.

But for many of those who can afford it, adventure is in the air.

One executive at a major tech company, who spoke on the condition of anonymity because she was not authorized to talk to the media, said she and her husband had both been discussing quitting their jobs in recent weeks. The pandemic, she said, had taught them that they’d been playing it too safe with their life choices, and missing out on valuable family time.

The executive then sent me a quote from the Buddha about impermanence, and the value of realizing that nothing lasts forever. Or, to put it in slightly earthier terms: YOLO.

Have questions? Ask me. I can help.

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