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Fire Meets Ice

Jonathan Clements

HAVE WE GOT IT ALL wrong? “It” is our relentless, lifelong focus on socking away great wads of money, so we don’t have to worry about earning another penny once we reach our 60s.

In fact, adherents of the FIRE—financial independence-retire early—movement aim to reach this blissful state far earlier, perhaps even in their 30s. This, of course, involves saving voraciously, with all the financial sacrifice that’s entailed. Even retiring in our 60s can seem like a Herculean task, generating much hand-wringing and financial stress. Is all this really necessary?

For those less enthralled with the traditional vision of retirement or its more extreme FIRE version, let me suggest an alternative. I’ve dubbed it ICE, short for “I’ll continue earning.”

This line of thought was inspired by a recent Ken Cutler article that raised two important questions about today’s notion of retirement. First, are we overly focused on amassing ungodly sums for retirement? Second, should we strive to remain useful throughout our life, rather than bowing out of the workforce in our 60s or earlier?

While I think our current concept of retirement could do with some tweaking, I wouldn’t want to discourage folks from saving aggressively for their later years. At the same time, I think it’s instructive to think about a different model of retirement, one where we continue to earn at least some income well into our 70s and perhaps beyond. Consider five implications:

  • From the get-go, we might pick a career less for its income and more for its joy—because we envisage doing it for as long as our mind and body allow. As the saying goes, if we can find a job we love, we’ll never work a day in our life.
  • All the anxiety over saving like crazy and investing prudently would be much diminished, because the financial stakes would be far lower. Sure, we’d still need to save for house down payments, college costs, financial emergencies and some period at the end of our life when we’re no longer able to do the work we love. But the total sum involved would be far smaller, and meeting all these goals would no longer seem like an all-but-impossible financial juggling act.
  • Similarly, all the fretting over finding the right retirement-income strategy would be greatly reduced. To state the obvious, retirement’s fundamental financial dilemma is we’re trying to pay for decades of living expenses without a paycheck coming in. With the ICE model, this problem is largely solved: Our “retirement” income might consist of Social Security, a paycheck and—if that paycheck is smaller because we’re working part-time—some modest amount of savings. The math is compelling: If we can earn $30,000 a year with part-time work, that’s like having a nest egg that’s $750,000 larger, assuming a 4% withdrawal rate.
  • Today’s pressing demographic problem—too few workers, and too many folks dependent on the goods and services that they provide—would be solved. That, in turn, would mean less reliance on imported goods and hence a smaller trade deficit, less inflationary pressure, fewer labor shortages and more taxes collected, including the payroll taxes needed to keep Social Security on a sound financial footing.
  • The whole issue of finding a purpose in retirement goes away. Our work remains our purpose. And thanks to the physical, social and intellectual stimulation that this work provides, we’d likely enjoy longer, healthier lives.

Among readers, I can imagine two big objections to all this. First, what if we really want that life of endless leisure? Or what if we want to spend our later years doing things that nobody’s likely to pay us to do, such as writing poetry or volunteering at our place of worship? Clearly, the ICE strategy doesn’t work.

Second, what if we simply can’t work, either because our mind or body won’t allow it? Wouldn’t we need a huge pile of savings for that? No doubt about it, this is a huge issue. But it’s an issue we already face, as evidenced by the many families that struggle today to provide and pay for long-term care.

As I see it, our current retirement ideal—that the good life means stopping all paid work in our 60s and perhaps earlier—rests on two questionable assumptions: that work is a distasteful task that we should escape as soon as we can, and that our goal should be to spend our later years avoiding anything so useful to society that it comes with a paycheck.

I realize that many, and perhaps most, folks have bought into these two assumptions. But wouldn’t it be great if we viewed work and retirement differently? Indeed, I suspect that, if they could do work that they love on a flexible schedule, a lot of retirees would jump at the chance to enjoy the income, camaraderie, and sense of identity and purpose that work can offer.

Convinced? Even as I advance these ideas, I must confess to cold feet. If my younger self hadn’t saved like crazy for retirement and I now faced the prospect of working for the rest of my life, would I feel happy with my choice—or trapped? Could any of us reliably predict in our 30s what our desires will be in our 60s?

Still, I think there’s an opportunity here for each of us individually and for us as a society. Businesses, faced with ongoing labor shortages, should be working to design jobs that would appeal to older Americans. Congress should be tweaking the tax code to make it more financially attractive for seniors to keep working, knowing the revenue that the government gives up would be more than offset by the additional taxes that these older Americans end up paying.

And we should all be thinking not just about saving enough for retirement, but also about what work we’d love to do in retirement and how we could get paid for doing it. If we can identify that perfect job, maybe our 60s and 70s would be a whole lot less financially stressful—and a whole lot more fulfilling.

Jonathan Clements is the founder and editor of HumbleDollar. Follow him on X (Twitter) @ClementsMoney and on Facebook, and check out his earlier articles.

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