Considering taking an early retirement to pursue a passion project or life-long dream? Welcome to the world of protirement.
Coined in 1961 by U.S. broadcaster Arthur Godfrey, protirement, in essence, is living the dream and it’s what many hope to achieve as they trade in jobs and professions to follow their fancy.
But living the good life into your sixties, seventies and eighties requires a substantial amount of financial backing, a common gripe of investment advisors who say Canadians aren’t as prepared as they should be for life’s third and final act.
So is there a magic number you need in order to retire early? That all depends on you. Are you a saver or a spender? Like to tinker in your garage or take lavish trips to far-off destinations? Do you quaff champagne by the case or is your taste more for cheap beer?
“Most are fearful and have a bad case of retirement anxiety,” says Jim Yih, a retirement planner from Edmonton. “I always ask if people worry about the future and 75 to 80 per cent raise their hands. And that’s because they don’t have a proper retirement plan, which is really a vision for their future.”
So what’s the answer to retiring early? It’s simple, says Yih: save more.
“We’re all looking for shortcuts and the path of least resistance,” he says. “If you want to retire early you need to save more. How much depends on you. Some people can live comfortably on $50,000 a year while others would say that’s poverty. Settling on a lifestyle that matches the money is key.”
Defining what protirement looks like
Invariably a conversation about retirement leads to a chat about the kind of lifestyle you’re hoping to achieve and this is the area Ellis Katsof has covered in his yet-to-be-published book, Life 3.0 Protirement not Retirement: The Boomer Alternative. The 65-year-old Port Dalhousie, Ont. resident was motivated to write the book after retiring in 2016 from his position as CEO of a Niagara-based mental health agency. Bored and lacking an identity, Katsof discovered an abundance of books on the financial side of retirement, but few covering the lifestyle part. He had found his calling.
Initially, he planned to interview 20 retirees about their experiences but by the time he was done that number swelled to more than 100, including former Prime Minister Paul Martin, Ken Dryden, Liona Boyd and Lloyd Robertson.
“For me, after interviewing more than 100 people, I felt there was a stigma attached to retirement, an implication that retirement meant we’re retiring for life and hanging up our shingle,” says Katsof. “And baby boomers have really come to dislike the word retirement.”
While a number of themes emerged from his interviews, one of the big recurring ones was the importance of staying active into and beyond retirement. “There is clear research that says you need to keep your feet moving to keep your brain active,” he says. “If you retire and you don’t do anything there is a good chance of dying prematurely.”
Work is just one facet of succeeding in this new stage: for most “protirees” they also seek out some combination of engaging hobbies, increased socializing, community building, care-giving, political activism, travel, philanthropy and entrepreneurial ventures.
According to Katsof, work is not so much a dirty word anymore for boomers, many of whom plan to work beyond 65. Of those interviewed, 63 per cent worked full time or part time after 65. The reasons for this vary, he says, but many boomers lost a portion of their retirement savings during the 2008 financial crisis and have a need to recoup their losses. Others are concerned that their retirement savings will not be sufficient if they live another 20 or 30 years after retiring.
While working on the book’s final edit, Katsof was approached randomly by four financial advisors across Canada asking him to hold workshops to help their clients. They said their clients were prepared financially for retirement but were grappling with lifestyle questions for that final phase of life.
“Because of that I’ve written a workbook to help people develop protirement to go along with their finances,” he says. “I love to create and be a change agent and this is a golden opportunity to do something in my protirement that I’m passionate about. I want to help people get over their fear and create a lifestyle for retirement they can enjoy.”
He’s planning to pilot a workshop on his new workbook this April.