Work & Finance

Early Release

The Best Life guide to retiring younger (and living better!)

Jim Parch knew when he was 27 years old that he was going to retire early. To be more precise, he knew this on May 30, 1967. His father had just retired as manager of quality control for E. F. Hauserman, a Cleveland company that made steel partitions. On Friday, the elder Parch, 65, got his gold watch and his pension, and the following Monday, he had a massive heart attack. “My dad didn’t have a single day of retirement. We had his retirement cake at the funeral,” says Parch. “I decided right then that I was going to retire at 55, and the financial decisions I’ve made every day since have moved me toward that goal.”

But a funny thing happened when it came time for Parch to leave his electrical engineering job. “I knew I was going to retire at 55 for so long that I was surprised when I got there and couldn’t do it,” he says. “I wasn’t prepared to give up my lifestyle. Besides, what would I do? I hadn’t thought about the day after my retirement party, and the day after that, and the next week.” He knew he didn’t want to sit in a rocker on the front porch. He wanted to work, but he also wanted to spend his time doing something he could be passionate about. He ended up launching a whole new career in medicine, as a medical surgical RN in an Arizona hospital. He loves his new job, but he also loves walking in the mountains and spending time with his wife and three grown children and three grandchildren, so he works only a few months a year.

Parch is on the leading edge of a huge cultural shift as Americans redefine retirement. Instead of trading the office for the golf course, guys are remaining in the workforce, but on their own terms. Whether it’s shorter hours, working from home, or just never, ever having to give another performance review, men are shedding the aspects of work they don’t like and pursuing their ­passions. John Voigtmann, of New York, got sick of the ­corporate grind, so he opened a bed-and-breakfast in Tuscany, Italy. Joe Szuba, of ­Michigan, found that as his career advanced, he was spending all of his time managing ­others, so now he calls the shots as a small-business owner. Marc Friedman, of ­Connecticut, had more money than fulfillment, so he left sales to help run a charity that is educating kids around the world. “Americans have gone from thinking about retirement as the end of something to the beginning of something new,” says Roy T. Diliberto, chairman of RTD Financial Advisors Inc. and author of Financial Planning: The Next Step.

If you’d like to trade Six Sigma for shorts and a T-shirt in the next 15 years or so, your timing couldn’t be better. In the next two decades, a flood of baby boomers will reach retirement age, and the generation immediately behind them, those in their forties now, isn’t big enough to fill the hole left in the workplace. Between 2005 and 2020, according to the Bureau of Labor Statistics, the number of workers ages 45 to 54 will fall by nearly 900,000. “The obvious good news is that there just won’t be enough young talent available to fill your shoes should you be inclined to leave the workforce in the next 20 to 30 years,” says Mitch Anthony, author of The New Retirementality. “Until recently, companies could afford to let older workers walk out the door because there were plenty of baby boomers available to take their place. Soon, companies will have nowhere to turn but to the current worker.” That gives you enormous leverage to set the terms of your employment or look elsewhere for a company that needs your skills. There will be lots of ’em.

When, in the late 1800s, German Chancellor Otto von Bismarck first cooked up the idea that workers should stop laboring at the age of 70 years, the average life span was 47. And when Franklin Delano Roosevelt introduced Social Security in 1935 and pegged the retirement age for the American worker at 65, the average life span was 63. In fact, so few people were living to retire that FDR eventually moved to lower the age to 62. In the 73 years since, the retirement age has risen to the current 66, but the expected life span for Americans is now almost 78 years. By 2020, a healthy man may well spend as many, if not more, years in retirement as he did working. And fewer and fewer plan to spend those years in idle pursuits: Almost half of pre-retirement-age men in the United States report that they plan to work into their seventies or later, according to an AARP survey.

“Retirement was never intended to draw people with strong productivity potential out of the workplace,” says Anthony.

Still, unless you are one of the lucky dotcom billionaires, building a big-enough nest egg to support the next phase of your life will require solid planning, even with work in the equation, and the sooner you get started, the better. All you need is a clear goal, the discipline to save, and a smart investing strategy. On the following  pages, we’ve put together an action plan that will get you there in 15 years.