Makin' Money

The Big Shift

Chris Farrell May 4, 2011

We all know that Americans are getting older and living longer. But the popular attitude toward the coming age wave is dismay. We’re gripped with foreboding about an aging population, haunted that spendthrift baby boomers haven’t saved enough, fearful that the Social Security system will buckle. Toss in the belief that the swelling ranks of the elderly will send medical costs spiraling out of control and it’s understandable why the mantra “we can’t afford it” echoes from Senate hearing rooms to corporate boardrooms.

The mantra is also wrong. Really wrong.

Look, there are many reasons for believing that the age apocalypse won’t arrive. Like your grandfather’s Oldsmobile, the image of an America debilitated by age belongs to a different economy and an earlier generation. Don’t take my word for it. Pick up a copy of *The Big Shift: Navigating the New Stage Beyond Midlife *by Marc Freedman. He’s the founder of Civic Ventures, a San Francisco-based nonprofit that focuses on boomers, work and giving back.

When Freedman hit 50 he figured he needed a break from work. He settled on Medford, Oregon and he was pleased to get a nice AARP discount the hotel reservation. But then he had to call back and order two cribs since he has two very young children.

So, what does that make him? He’s neither young nor old. He isn’t a near-retiree nor a traditionally aged parent. Like lots of 50-somethings he’ll probably work for another quarter century or so. They’re also old enough to know that 25 years isn’t very long and they want to make a difference with their remaining active years. “The surge of people into this new stage of life is one of the most important social phenomena of the new century,” he writes. “Never before have so many people had so much experience and the time and the capacity to do something significant with it. That’s the gift of longevity, the great potential payoff on all the progress we’ve made expending lives.”

Freedman knows that any individual transition toward a life and work that is more meaningful is difficult, often a painful process, full of stumbles and setbacks. There’s only so much individuals can do on their own dime and initiative. It takes institutions to support a major social change. Freedman makes a number of public policy suggestions, from new kinds of educational institutions suited to this new stage of life to tax-sheltered Individual Purpose Accounts to fund the costs of transition.

We did it with retirement in the early post World War Two years. The poverty rate among the elderly plunged thanks to Social Security. Older Americans gained universal health-care coverage with Medicare in 1965. Corporations offered their workers defined-benefit pension plans based on a salary and years-of-service formula.

It was in these years that retirees developed a distinct lifestyle captured by the mass migration to Sunbelt communities. “In the past, such an experience of retirement was limited to the wealthy few that could afford it,” writes MIT economist Dora L. Costa in The Evolution of Retirement. “Now, it is an option available to the majority of workers.”

Survey after survey has shown that a majority of boomers say they want to work in their elder years. They’re going to get their wish. The real question is what do they do with the opportunity? “As a generation, we have been granted what amounts to a great gift of time–of experience, understanding, and the capacity to do something with it.”

I helped moderate a discussion by Freedman on the Big Shift last night. Everyone seemed energized by the possibilities and daunted by the practical obstacles confronting anyone eager to marry meaning and work. The Big Shift is well worth reading because it gets you thinking.

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