The “I’m Never Going to Retire” Retirement Plan

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Stephen writes in:

I’ve basically made the decision that I’m never going to retire. I’m going to keep working until I literally cannot work any more, at which point my physical and mental decline should be pretty steep and swift. Given that, what’s the point of saving for retirement? It seems pretty ineffective for me.

Here’s the truth: the idea of “retirement saving” is shorthand for a somewhat different idea. Your 401(k)? Your IRA? They’re actually just “savings vehicles that defer tax benefits until you’re 60.”

With a Roth IRA, for example, you can begin taking money out of the account tax free at age 59 1/2. With a 401(k), you can begin taking taxable withdrawals (taxable as normal income) at age 59 1/2 as well.

Along with Social Security kicking in at some point in your sixties, this money will provide some extra support for you during those latter stages of your career.

Many people just assume that this money means “retirement money.” It’s an understandable assumption. At an age where people’s Social Security is kicking in, they become eligible for the tax benefits of withdrawing money from those accounts.

However, what you choose to do with that money is up to you. It does not have to involve any sort of traditional retirement if you don’t want it to.

For example, I fully plan on using that money to take some rather large career risks. I’d like to be able to financially justify spending most of my psychological energy in a day working for a charity or working on a novel with no guaranteed sale, but that’s just not financially sensible right now.

Right now, I have three young children at home. I need to make at least some level of reliable income in order to be able to support them well.

In twenty five years, when I cross the age threshold to be able to utilize those accounts, my youngest child will be in his upper twenties. My oldest child will be almost the age I am right now. (That’s almost unbelievable to think about, but it’s true.)

My wife and I will be alone, without other dependents. Our expenses will be lower.

Given that, along with the money I’ll be bringing in from my retirement accounts plus any money I get from Social Security, our financial situation becomes a different picture. I will be able to afford significant career risk.

In a lot of ways, I’m a lot like Stephen. The idea of “retirement” as it is often popularly presented doesn’t really appeal to me much at all. I get bored when I don’t have something either mentally or physically energizing to fill my hours.

Even given that, as I stated above, I’m heavily invested in my “retirement” accounts. They’re going to afford me the freedom to make career and life choices later on that don’t necessarily make a lot of sense right now.

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