I’ve always been interested in the origin of words and phrases. It turns out that “humble pie” was actually a dish you could eat (“umbles” are the lesser cuts of a deer and were made into a pie – Samuel Pepys refers to them in his diary). And “Bob’s your uncle” refers to the appointment of Arthur Balfour as Minister for Ireland in 1887, by his uncle, Lord Salisbury. Nobody seems to know why we say “Fanny’s your aunt” though!
“Retirement” originates from the French, meaning “to withdraw to a place of safety or seclusion”; we still use this version of the word nowadays when we retire to bed. But many of our clients seem to do the opposite of withdrawing to safety when they retire (I’m reminded of the 90 year old who went gliding on her birthday!).
We have been using the meaning “to leave an occupation” for around five centuries now, but the word has become increasingly confusing in the last couple of decades. Pension companies still refer to “normal” retirement ages as if nothing has changed in the last thirty years. Back in the last century, employers were able to insist that we retired at a particular age, which usually coincided with the state pension age (there used to be just two state pension ages – one for men and one for women). Now, we tell our employers when we want to stop work, there are a large number of state pension ages, and we can start drawing our company and personal pensions at any age after 55 (57 from 2028). And there needn’t be any connection between the date you stop your work, the date you start your state pension and the date you take some money out of your company or personal pension.
Added to that, for many people, retirement has become a gradual process. One of my friends told me that he had retired last year; he now works for four or five months a year (doing something a lot less stressful), but still insists he has retired. It’s not unusual, particularly for business owners, to spend several years retiring. My Dad only completely stopped work at the age of 88!
The increase in the number of private landlords has also blurred the lines between retirement and work. Whilst it might not be a full time job to let out one or two properties, there is work to do – rents need to be collected, bills paid, maintenance carried out and new tenants found from time to time. The first thing that one of my clients did when he “retired” was to spend a year refurbishing a property he owned, before putting it on the market. As private landlords age, there is likely be increasing work for property managers; and many private landlords might never fully retire.
It used to be thought that the Inuit peoples had lots of different words for snow (it turns that this is only partly right – my blog writing took an interesting 25 minute diversion when I tried to check this out!). But maybe we need some new words to describe some of the modern concepts of retirement:
- Not doing the job that used to be part of my identity
- Not working as much as I used to, but not intending to stop completely for a few years yet
- Drawing down my state pension or some other pension, but still working
- Drawing an income from an investment, like a property, which requires some input from me
- Not working at all and living off pensions and investments (i.e. what we used to call retirement).
In the age of longevity, is it time for “retirement” to retire?
Philip Wise | firstname.lastname@example.org
Managing Director and Chartered Financial Planner