For your parents, retirement was often a finish line. You worked, you stopped (in more ways than one), and a pension showed up every month. There was a clear exit from the workforce and a sense that the plan was done. For today's near-retirees, retirement will play out very differently. It will be less of a finish line and more of a start to a new chapter . It will require more engagement, more decisions, more flexibility, and more personal responsibility than previous generations ever had to manage. One major shift is from pensions to a self-created personal pension and portfolio. Most people retiring today are responsible for creating their own income strategy to augment Social Security. There's no employer absorbing the risk anymore. Market timing matters. Withdrawals matter. And what happens in the early years of retirement can shape the rest of the journey. Another shift is moving away from a fixed retirement date and done. Many people plan to work part time or earn income in flexible ways. Sometimes it's about money. Often it's about staying engaged and keeping your mind sharp. Retirement no longer means working or not working. It often means working differently for a period of time. Longevity also changes the picture. Previous generations planned for a shorter retirement life. Today, many people need to plan for twenty or thirty years. That turns retirement into something closer to a second adulthood than an extended vacation, with greater focus on health, income, and risk over time. There has also been a shift around legacy. Rising healthcare and long-term care costs make it harder to assume assets will pass cleanly to the next generation. For many families, protecting independence and avoiding becoming a financial burden matters more than preserving an inheritance. Finally, identity plays a bigger role than most people expect. When work ends abruptly, the loss of structure and purpose can feel disorienting. Those who build interests, community, and contribution before leaving work tend to navigate retirement with more confidence and ease. This is not your parents' retirement. It's more complex, but it also offers more choice for those who treat it as a transition rather than an ending. I guess it may not even be "retirement" for some people. Or, we just need a new word to describe this chapter. How about Life After 60?
One of the most common retirement assumptions that clients make is that their fixed income will be enough to cover all of their expenses over time, but neglecting the effect of inflation. Purchasing power, especially for retirees and others living on fixed incomes such as Social Security or pensions, is adversely affected by inflation. Medical expenses and long-term care expenses have also increased significantly more than the overall rate of inflation, further diminishing the purchasing power of retirees' fixed income. Certainty is no longer the best bet for a secure retirement — flexibility and varied sources of income are.
Attorney and Executive Vice President at Cummings & Cummings Law at Cummings & Cummings
Answered a month ago
I am a licensed corporate and tax attorney, and I have worked with retirement plans throughout my career. Much of my legal practice is devoted to assisting clients with complex individual estate planning strategies. My firm is Cummings & Cummings Law, and my firm website is www.cummings.law. My bio can be found here: https://www.cummings.law/lisa-a-cummings/ I am summarizing my firm's analysis of outdated assumptions in retirement planning. The most common outdated assumption I see is that retirement is a single, predictable event funded by a stable mix of "safe" bonds and Social Security, with expenses that naturally decline. In reality, many households experience a rising and uneven spending curve driven by healthcare, housing transitions, and family support, while longevity turns a 25-year plan into a 35-year exposure to market and policy risk. Another significant retirement planning issue occurs when retirees often underestimate how one large financial decision, such as when to claim Social Security or sell a home, can permanently constrain future options. Additionally, many retirees fail to consider inflation changes. Inflation modeling shifts the focus from average returns to real purchasing power and timing. A retiree who encounters high inflation early can face a double hit: higher withdrawals and elevated sequence-of-returns risk. Fixed income expectations fail when investors treat bonds or cash as "risk free" rather than "volatility dampeners," because after-tax real returns can be unfavorable for long stretches. Healthcare now shapes the retirement timeline through Medicare premiums, drug costs, and care events that behave like an uninsured catastrophe. Social Security assumptions are often overly optimistic about claiming at 62, ignoring longevity protection and the gap between general inflation adjustments and healthcare inflation. The decline of employer-sponsored pensions has also increased retiree longevity risk. When I prepare a retirement plan for my clients, I always include the following considerations: Model the retirement plan under multiple inflation scenarios; model Social Security claiming ages; budget Medicare and long-term care scenarios; as well as including part-time income and tax-aware withdrawal sequencing. If I may be of any further assistance to you, please do not hesitate to contact me directly via email at lisa@cummings.law. Lisa A. Cummings, Esq. Firm website: www.cummings.law