Money Musings: Retirement is not an age ☀️
One of the things that’s really demotivating about retirement (depending on your age) is that it can be (and feel) very far off.
We may start saving for retirement in our 20’s and other than some potential tax write-offs, we don’t reap the benefits until we’re in our 60’s (or later).
Retirement needs a rebrand.
I titled chapter 7 of my book “Work Optional” because it shifts how we think of retirement. I heard the term from Tanja Hester (the author of Wallet Activism and Work Optional) and fell in love with it.
Retirement just means we have enough money saved (but really invested) that work becomes optional.
We have enough income from our retirement investments to cover our expenses so we can choose how we spend our time.
Mapping out our retirement goals is a balance between investing for our futures and spending now (both for necessities and enjoyment). And the more we spend (or want to spend in retirement), the more we need to have saved for work to become optional.
I’ve noticed more and more that people are reframing how they view retirement. Their goal isn’t necessarily to work for 40 years and then not work at all. Some are investing more early to have the flexibility to work less, take a pause and travel, or choose a career path where they might earn less.
Work isn’t ending - it’s more about flexibility and choice.
On the other end of the spectrum there’s also a retirement crisis. Due to the many gaps women and BIPOC face, including less access to work-sponsored retirement plans, they have less money set aside for retirement.
They aren’t sure when or if they will be able to retire. Each area of our personal finances is connected.
While it’s impossible to plan for exactly what our retirement will look like, reimagining what it currently means to us is a great way to reconnect with this lofty yet extremely important long-term goal.
How has your definition of retirement changed along your money journey?
MONEY MOVE OF THE WEEK
CREATE YOUR CONSUMER ACTIVISM CRITERIA.
Consumer activism means using your dollars to support or vote for
things you believe in. The idea is that when we buy or don’t buy something, our group buying power can influence companies to change their practices and policies. Pretty amazing, right?
What this means will look different for each of us because we value different things and have different priorities. What’s important to you about a company and their values? What criteria will you think about before supporting a company?
For me, I shop women and/or BIPOC-owned when possible. I like to support companies that care about sustainability and have fair labor practices.
Then rank your criteria in order of importance. I recommend doing this because sometimes there won’t be companies that fit all of your criteria.
I’m so inspired by hearing how others make these decisions. Hit reply and let me know your criteria and process!
IMPORTANT: It’s a privilege to be able to make choices with a consumer activist lens. Many can’t choose a more expensive option because the company is making better choices and many don’t have time to do this type of research given work and caregiving schedules. Take care of your own needs first. It’s okay to pick and choose where you can be a consumer activist, and it’s okay to start small and work your way up.
YOU GOTTA SEE THIS
THE MOTHERHOOD PENALTY.
Mother’s Day is this weekend and do you know what mothers want more than pancakes in bed and chocolate (it's ok if you want that too! 😂 ) ?
They want equal pay, paid parental leave, equal work in the home and the ability to thrive in our careers (a.k.a. removing the motherhood bias).
AND after yesterday's devastating news... I'm adding 'the right to choose motherhood' to the list as well. 🤬
Did you know the wage gap is compounded for mothers? Mothers are paid $0.70 for every dollar a father earns and the gap is even larger for BIPOC mothers and mothers with disabilities.
Research shows that 80% of the gender wage gap is due to motherhood and the ensuing unequal division of labor in the home and in childcare, dubbed by Arlie Hochschild as the “second shift” women work once they get home. The motherhood penalty is real and raging.
Yet, this bias is all about perception, not reality. According to the AAUW: Research has shown that hiring managers are less likely to hire mothers compared to women who don’t have kids, and when employers do make an offer to a mother, they offer her a lower salary than they do other women.
Men, by contrast, do not suffer a penalty when they become dads. In fact, there’s some evidence of a “fatherhood bonus” in which their earnings actually increase.”
Here’s what to do about it:
Vote for leaders who support affordable childcare, pay equity and paid parental leave
If applicable, work to make the labor in your home more equal - this will also model it for your children and the other young people in your life
Negotiate and know that when you do, you are doing it on behalf of women and mothers everywhere
If you have the privilege, work to make the hiring and review practices in your company more equitable
Don’t overlook mothers for opportunities, even if it requires travel or more work
Advocate for your own flexibility - you’ll create a more flexible environment for all employees, including mothers