When hospital administrator Kent Howard’s Kansas City hospital changed hands, the buyers offered the 62-year-old a severance package he couldn’t resist.
“I thought it was a great time to retire,” says Howard, recalling that his physician father went to the office every day until he was 75. “Dad was driven. Their lifestyle was a lot different than mine.”
Howard’s wife, Karen, had already retired once, for a year, from teaching sixth grade, but with her husband’s retirement imminent, she retired again at age 60. They quickly sold their Kansas City house and moved to Park City, where they’d previously lived, to enjoy an active retirement lifestyle. “I fit my retirement to go with his,” says Karen Howard.
To many baby boomers hoping to retire younger these days, retirement has a multitude of definitions. Many retirees are diving into other projects, starting new businesses, dabbling in part time jobs and becoming active volunteers. And they’re also traveling — a lot.
“Baby boomers fundamentally will reinvent retirement,” says James Gorman, a private client executive for Bank of America. The company’s New Retirement Survey predicts most boomers will retire by age 64 but then start various part time enterprises—not so much for the money as for intellectual stimulation.
Is 60 the new 50? Or 40? Yes, Americans are living longer than ever. By retiring earlier than their parents and living longer, retirees today will spend more time not going to work than any previous generation. By being younger and healthier overall, they’ll have more years for active lifestyles. And several industries are picking up and cashing in on the new retirement trends.
At Ray Citte RV in Ogden, sales manager Kent Richards says the average age of RV buyers he sees is declining. “It used to be 65 and older and that has changed immensely. They’ll downsize their home and get an RV at the same time,” he says.
The travel industry will probably be the biggest beneficiary of the coming wave of younger, more active retirees. “The boomers are a market we want to go after,” says Leigh von der Esch, managing director of the Utah Office of Tourism. She recalls an encounter this summer in a store in Torrey, just outside of Capital Reef National Park. “I saw this group of bike riders, 55 to 65, getting briefed on the ride for day. They had their camping gear on their bikes.”
Clearly, the dynamic is changing. “They’re not windshield tourists anymore in a bus looking through the windows and going on to the next stop,” says von der Esch, who is working with Utah’s travel industry to cater to the new dynamic. “You’ve got to sell amenities,” she says. Today’s retirees might be energetic enough to climb the grueling trail to the top of Angel’s Landing in Zion National Park, but when they come back down, they want to relax in a spa. The Travel Council is refocusing its message accordingly, promoting adventure travel with some luxury on the side. For example von der Esch says Red Cliffs Lodge, outside Moab on the Colorado River, offers a dusty red rock horseback ride or four-wheel drive adventure, followed by opportunities to relax, listen to live music, drink locally produced wines and dine on gourmet cuisine—a backpacker meets Napa experience.
Karen Howard says she fits that mold with her husband. “We want to go-go instead of slow-go or no-go,” says Howard. “We travel anywhere we think it’s a good place to go.” She also says when they review their credit card bill each month, it’s easy to see where the money goes. “A huge part of it is travel. Not much for clothes, and a fair amount for restaurants and entertainment.”
A New Nest
With their kids grown and gone, today’s retirees are changing their addresses, like the Howards have.
While they travel a lot, they do like a nice place to come home to and builders are trying to find the niche to attract them. In the Heber Valley, The Sorenson Group is developing 9,000 acres around the Jordanelle Reservoir focusing on early retirees in its first phases, Jordanelle Ridge and River View on the Provo River. “We are targeted to that buyer profile—active adults, business people, 50 to 65, who have done well,” says Mark Staples, the group’s vice president of development.
Around the bend in Park City, veteran real estate agent Jim Lea sees the same demographic among retirees. “They’re younger and have more money, he says. “They’re retiring earlier than past generations—these are not rocking chair people.” Lea also says those who retire in Park City don’t wait to leave at the top of their careers. “They’ll sell their company and choose to do those things on a full-time basis that they’ve only been able to do two weeks a year.”
But as these freewheeling seniors live the ski and golf lifestyle in the Wasatch Mountains, Lea says builders haven’t yet caught on to what they need. “I get more requests for single level living and there just aren’t many [homes] out there, he says. “They’re looking to the future when they might be less mobile. There’s an ongoing demand for single level dwellings that’s not being met.”
Make It Happen
Making sure active retirees have the means to play and play hard requires skilled money management. Wealth advisors like Paul Shoemaker, Bank of America’s Salt Lake vice president, helps them reach their goals. “Back in the good old days there were pensions,” he says. “Now people have bigger nest eggs and pensions aren’t so prominent. They can be more flexible now, as long as they invest properly.”
Susan Mayo, managing director of JP Morgan Chase’s Private Wealth Manage-ment Group in Salt Lake agrees. “These people are running at the speed of life,” she says. “You have to slow them down to get their attention on financial planning.”
And when she does, she sees different dynamics at work. While past generations listened to professional advice, today’s active retirees ask sharper questions and have their own investment ideas.
“They want tax efficient ways to grow money, they’re willing to take more risks, and they’re more educated,” she says. “This group is all about enterprise; they don’t feel the limitation the culture had with our folks.” Mayo adds that today’s active retirees still dabble in consulting, act as expert witnesses and start or volunteer for non-profits.
Shoemaker agrees. “A majority of [retires] think they’ll live longer so they stay involved more,” he says. “They make sure they enjoy as much as possible— sailing, hiking, golf—They want to make sure they can do it before they get too old.” And money managers have to stay ahead of their sophisticated clients, who monitor the Internet and know their account balances daily. Now, Shoemaker says, “People stay a lot more connected to their money.”
Staying connected to their money doesn’t mean active retirees are necessarily holding it tight in their wallets. This generation is noticeably more generous than their parents, largely because they have more to give and don’t feel a need to be as conservative as past generations. Many fundraiser and development directors are seeing younger and more receptive donors than before. “Many people of means have chosen to retire earlier than their parents and take an active role in philanthropy,” says Don Gomes, director of the Utah Non-Profits Association. “They do want to give but often it’s accompanied by ‘I want to be involved’ as well. And that’s not a bad thing,” says Gomes. “A lot of people are saying they’re still capable and able and are really drawn to the non-profits. Many of them have skills to offer.”
Mayo sees this charitable side with her clients as well. “They rarely stop [working] entirely,” she says. “They start giving back, going into non-profits, getting involved in a cause.” Often, she says, they will start new organizations in the tradition of entrepreneurship that got them ahead in the business world to begin with instead of throwing themselves into existing organizations.” The number of non-profit organizations is exploding nationwide as active retirees translate their natural passions from the profit world into non-profits.
The trend toward service has even created a hybrid, which might be called “non-profit, service-oriented travel,” in which active retirees come to Utah to work as volunteers at archeological and paleontology digs or help build trails and facilities at Forest Service and National Park Service sites. The Best Friends Animal Sanctuary outside Kanab attracts a steady stream of active retirees who volunteer to take care of animals at the no-kill sanctuary for a few days or weeks at a time.
Karen and Kent Howard are characteristically what today’s experts are classifying as active retirees. They are outdoors enthusiasts and keep regular appointments with the weights and aerobic machines in their home gym. They travel widely, taking a three-day weekend trip monthly and grander tours to destinations like Italy and Costa Rica when the urge strikes. To stay engaged in service, they volunteer at their church and Kent sits on the board of a non-profit health foundation in Salt Lake, while Karen tutors math three hours daily. In-between, they play with grandkids, hunt, fish, golf, ski, snowshoe and walk their dog. Kent is now also involved with a startup company in the medical staffing field.
“We could both find a job,” says Kent as he relaxes in his hot tub. “We’re always surprised that after working 12 to 14 hours a day your whole life you don’t really have to do anything—and that’s just fine!”