The Secret to a Successful Retirement: Don’t Retire
Renowned economist Alicia Munnell, a leading expert on retirement, has a surprising piece of advice: the key to a successful retirement is not to retire at all. At 82, Munnell has practiced what she preaches, putting off her own retirement for decades. As the founding director of the Center for Retirement Research at Boston College, she will step down at the end of December, but will remain with the center as a senior adviser.
Working Longer: The Answer to a Secure Retirement
Munnell’s philosophy is simple yet powerful: work as long as you can. This approach allows individuals to receive larger Social Security payments and reduces the number of years they need to support themselves in retirement. While she acknowledges that not everyone can continue working due to health issues or physically demanding jobs, she believes that many people can benefit from extending their careers.
Start Saving Early and Plan for a Long Career
Munnell’s advice for young people just starting out in the workforce is to begin saving for retirement as early as possible. She emphasizes the importance of taking advantage of employer matching contributions and planning for a long career. By doing so, individuals can set themselves up for financial success and security in their golden years.
A Life of Service and Contribution
Prior to her role at the Center for Retirement Research, Munnell served as an assistant secretary at the Treasury Department under President Bill Clinton and spent 20 years at the Federal Reserve Bank of Boston. She has no major professional regrets and is proud of her contributions to the industry.
A New Chapter: Embracing Retirement
As Munnell prepares to step down from her director role, she is unsure of what retirement will bring. She has no major regrets and is looking forward to pursuing her hobbies, including watching TV shows, playing bridge, and cooking. Despite the challenges facing the U.S. retirement system, Munnell remains optimistic and believes that universal retirement plans could greatly improve economic security for all workers.
Personal Financial Lessons Learned
Munnell shares two personal financial regrets: keeping too much money in a regular 401(k) and taking her pension early. However, she is proud of her decision to make a budget and downsize her home, which allowed her to continue working into her 80s. Her story serves as a reminder that even experts can learn from their financial mistakes.
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