Facing Death

One of the blogs I read and very much enjoy is called Time Goes By. The author of this blog has been fighting cancer and recently went into remission, however, she just posted that her cancer has come back and this time the chemotherapy will not stop it, but only slow down its progress. That is very sad news for he and her family, friends and the thousands of us who read and enjoy her writing. 

She has realized that she will soon die, and so at this point, she is in good humour, if her blog post is any indication. She says: 

Because I know that regular and fairly heavy exercise goes a long way toward staying healthy in old age, I've been doing that (with the exception of the months of recovery after the surgery) five mornings out of seven for six or seven years - and I despised every moment of it. Now there is no reason and I am relieved.

Another upside is that I don't have to worry about dementia anymore. No more of those little online tests about what are normal memory problems and what are not. Whew. I'm glad to be done with that too.

I'm sure that in the coming days and weeks I'll find some other things I can happily leave behind.

So what should I do with the time left to me? Yeah, yeah, I know – everyone is dying every day but believe me, I now know that it is quite a different thing from that abstract platitude to a closely defined period of time.

She goes on to say and with more courage than I might have, 

My main daily occupation is this blog and its subject – what it is like to grow old. I've been doing this for about 15 years and still am not tired of it. It feels a lot like the years I was employed – going to work every day doing something that I enjoy.

Five days into my new circumstance now, I have decided to keep doing these things as if I had all the time in the world. That may change in the weeks and months to come and if so, I'll figure out then what is next.

For now, from time to time I will write here about this final journey hoping that what could be taken as overly self-indulgent might, for some readers, be of possible value as another person's way of approaching the end of life.

Another quotation that has helped drive my life is from the British writer, E.M. Forster. I discovered it when I was in my twenties realizing then that it describes perfectly how my mind worked and still works:

”How do I know what I think until I see what I say.”

For me, it takes writing it down (on paper or, these days, on a screen) to know with any clarity what I think and believe. So writing for you is also for me and will help me work out this frightening last mile or two.

If you have not had the opportunity I recommend that you go visit her blog. I will continue to read her and hope that medical advances will take place that will help in her journey. 

What does retirement mean?

What is retirement?

A study completed in 2008 called What is Retirement? A Review and Assessment of Alternative Concepts and Measures by  Frank T. Denton and Byron G. Spencer looked at this question. I found their answers interesting

Retirement happens to older workers when they withdraw from the workforce. Older means those over the age of 55, or even 60. Whatever else they do those who are younger seldom ‘retire’. The meaning of ‘withdrawal’ is also elastic. At one extreme is a full withdrawal – i.e., no labour force activity and hence no hours of work and no earnings from work. At the other would be a reduction in work effort deemed sufficiently large to qualify – e.g., by some arbitrary amount, at least one-quarter, or one-half, say – but not necessarily all the way to zero.

In Canada Statistics Canada has a ‘standard definition’ of retirement: “retired refers to a person who is aged 55 and older, is not in the labour force, and received 50 percent or more of his or her total income from retirement-like sources

So, retirement is not that easy to define here are some other definitions of retirement that academics have used to study this issue

• An older worker has ceased participation in the Labour Force,
• An older worker has had a reduction in hours worked and/or earnings
• An older worker has hours worked or earnings which are less than a predefined minimum (less than 20 hours a week for example)
• An older individual is in receipt of retirement income that accounts for most of his/her income
• An older worker has left their main employer
• An older worker has had a change of career or employment later in life
• A person self-assesses they are in retirement

They conclude their study by noting that while the concept of retirement is prominent in both popular thinking and academic studies, there is no unique measure that can be attached to it. The problem is that what underlies the concept of retirement is the essentially negative notion of attempting to define what people are not doing – namely, that they are not working. In almost all cases the underlying notion is that working time has been withdrawn from the market economy.

But measures that reflect the absence of market-oriented activities ignore what people are actually doing. The fact is that much nonmarket activity is socially productive even though it is not included in standard measures of national income. One could be not in the labour force (using standard indicators), hence not engaged in market activities and not contributing to the measured national income, but still be contributing to the well-being of the society.

This might happen through the provision of unpaid contributions of time, or volunteer services. There are many examples of ways in which individuals spend time providing contributions that are recognized as socially valuable but whose worth is not included in conventional measures. The Boomers are redefining what it means to be retired and over time the definition of what it means to be retired will be very different than the idea that a person has “withdrawn from the labour force.”

Opt in or Opt out Pension Plans

There is a gap between what we should save for retirement and what we actually save for retirement. Many retirement plans and many countries do not have a forced option. In Canada, if you work for an employer the employer and you are required to contribute to our Canada Savings Plan. There is not an opt-out option unless you work for yourself.  In a survey done in 2017, it was found that after talking to over 22,000 investors from 30 countries, people in every country, except for Denmark, reported saving less than the amount they need to be contributing in order to have a comfortable retirement.

Respondents in Denmark saved too much, putting away 13 percent of their income, on average, compared to the 12 percent they feel they need to contribute. Chileans are also saving 13 percent, on average, but they feel they’ll need to put away 19 percent of their income. Canadians’ disparity is just two percentage points, with respondents saying they’re saving an average of 12 percent of their income, while they feel they’ll need to put away 14 percent for a comfortable retirement.

Globally, survey participants also underestimated how much of their retirement income they’ll spend on basic living expenses. Overall, they said they’d spend 34 percent, but in reality, they’ll likely need nearly 50 percent, according to the survey.

Canadian respondents said they’d need 42 percent, whereas the survey found they’d actually need 59 percent. The biggest gap in expectation versus reality is in South Africa, at 34 percent and 59 percent, respectively, while Indians are much more in tune with reality, at 26 percent and 25 percent, respectively.

Mexico has taken a rather unique approach to get people to think about retirement and to actually contribute more. In Canada and in the US and I suspect other countries, cashiers will often ask consumers if they’d like to donate to a charity as they pay for items at retail stores. Mexico applied this concept to retirement savings with good results.

Rhe Mexican project is a collaboration between Mexico’s pension regulator, the country’s 11 retirement savings administrators and Ideas42 (, a U.S.-based non-profit organization that applies behavioral insights to find solutions to social problems). The goal was to find a way to encourage higher voluntary contributions to retirement savings.

Mexico’s pension system has called for 6.5 percent of an employee’s salary to go into individual retirement accounts. For workers formally employed in registered, salaried jobs, the mandatory contribution includes an amount from employers (5.15 percent), employees (1.125 percent) and the government (0.225 percent). At that contribution rate, employees are likely to retire on 40 percent of their current salary, an amount considered insufficient for a successful retirement.

While low voluntary contributions in the formal employment sector are cause for concern, the situation is even direr for the 60 percent of Mexicans who are unemployed or working informally or independently. People in this group, are not only not making mandatory contributions to a pension plan but most likely aren’t saving at all for retirement.

After spending time finding out why people are not thinking about or contributing to their retirement they targeted a representative sample of about 77,000 people from a single pension fund administrator and encouraged both active and inactive account holders to make voluntary contributions at the retail level.

They sent out a direct mail communication about the retail branches and paired it with a micro-incentive — either a free cup of coffee at 7-Eleven or entrance into a lottery — when people went to 7-Eleven to make a contribution.

To make a voluntary contribution, account holders provide their citizen identification number and the cashier provides a receipt of the transaction. The identification number serves to direct the funds to the national database and, from there, to the pension fund administrator.

To address a tendency to procrastinate or not consider retirement, they also used a face-aging software through the banks’ mobile apps that will show people an aged photo of themselves to make retirement feel more vivid.

As for the lessons has taken from this pilot projects the researchers have found that increased access to savings vehicles through retail channels alone wasn’t enough to boost contribution rates. Most important is that increasing access does not translate to behavior change — in this case, contributions. Nor does access make the idea of pension contributions more top of mind.

What works is making participation the default option. In this model, people are registered to participate in employer-sponsored pension plans on employment. They can opt-out after a specific period of time.

By switching from an opt-in approach to opt out, people will still have the flexibility to withdraw their participation. But the evidence suggests most people will be glad to be automatically enrolled and will continue to stay enrolled.

Perspectives on Retirement: Generation X

Generation X (born 1965 to 1978) entered the workforce in the late 1980s and is the first generation to have access to 401(k) plans for the majority of their working careers.

Seventy-seven percent of Generation X workers are saving for retirement and they started at age 28 (median). Among those participating in a 401(k) or similar plan, they contribute seven percent (median) of their annual pay.

Unfortunately, 30 percent of Generation X retirement plan participants have taken a plan loan or early withdrawal, with commonly cited reasons relating to paying off debt or unplanned major expenses. This may be partly explained by low levels of emergency savings. Generation X workers have saved just $5,000 (estimated median) to cover the cost of unexpected financial setbacks. Twenty-four percent have saved less than $1,000 for such emergencies.

The total household retirement savings for Generation X is $69,000 (estimated median). Just 12 percent are very confident that they will be able to fully retire with a comfortable lifestyle.

Generation X has entered its sandwich years, with many in the middle of raising children and looking after aging parents –while juggling their jobs. They may feel that they cannot afford to invest in their own retirement –or they may be strapped for time to plan for retirement. Forty percent of Generation X workers agree with the statement, “I prefer not to think about or concern myself with retirement investing until I get closer to my retirement date.”

Generation X is behind on their retirement savings, but they still have time to catch up if they begin focusing on it right now and start saving more. An excellent starting point is calculating retirement income needs and a savings goal. Fifty-two percent of Generation X workers say that they guessed their retirement savings needs. Just 12 percent used a retirement calculator or completed a worksheet.

One of the most important secrets to attaining retirement readiness is having a well-defined written strategy about retirement income needs, costs and expenses, and risk factors. The majority of Generation X workers (60 percent) say that they have a retirement strategy, but only 16 percent have a written plan (the other 44 percent have a plan but it is not written down)