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Majority of Baby Boomers no longer interested in an encore career: Survey

Yahoo Finance’s Stephanie Asymkos breaks down the growing number of Baby Boomers embracing early retirement and changes in financial plans and lifestyle.

Video transcript

ALEXIS CHRISTOFOROUS: In today's "Your Money" segment, a new survey finds older Americans are opting out of the workforce and calling it quits as the pandemic forces many to reprioritize what's important to them. In fact, Baby Boomers have exited the workforce and embraced retirement more in 2020 than in the last decade. Here with more is Yahoo Finance's Stephanie Asymkos. Stephanie, give us the details here.

STEPHANIE ASYMKOS: That's right, Alexis. So it's really just another manifestation of that great resignation that everyone's talking about. But in this case, for Boomers, it's a permanent resignation. For the Boomers who are still working, you know, let's think about all the workplace changes that have happened over the last 18 months.

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This generation has really been forced to adapt and adopt new technology like never before. And it might have brought some people and triggered a breaking point for some. Think about, like, a 40-year career, and there might not be that enthusiasm to adopt these new ways of productivity, or connectivity, or new business protocols.

And then even if you weren't able to work remotely, just being in the presence of others before we had vaccines for COVID, that was very dicey and very risky. So all of that has either been embraced or rejected. And for those who have rejected it, it's really translated to that early retirement.

ALEXIS CHRISTOFOROUS: So how does that sort of deviate, I guess, from the traditional path one would take to retirement?

STEPHANIE ASYMKOS: So what's really interesting when we talk about Boomers is that Boomers are actually credited with bucking this traditional retirement trend. And for the last decade or so, we've kind of seen Boomers use their retirement to pursue passion projects or even switch careers.

And it got so popular that it even earned a name for itself called the encore career or the second act. Now, all that's changed. The generation has changed its tune. And survey data reveals that the majority of Baby Boomers just aren't interested.

They're saying pass on this so-called second act. They really want to spend time with their friends and their family and make up for this time that's been lost-- that we've all lost over the last 18 months. So even if it means living a little bit more modest retirement, the overwhelming choice among Boomers is that they want to retire early.

So nearly 80% said they would rather retire at 65, live a little bit simpler, then retire at 75 and live large, which is a big change from what we've seen. And one way that the spending habits have changed and what I find to be really interesting is that Boomers are actually taking a page from that millennial playbook and choosing to spend their money on experiences instead of material objects, which is a major change of heart for this generation.

So sources tell me that this is a trend that's likely to continue. Older Americans are just utilizing their capital and their savings to live simply and surround themselves with loved ones rather than working towards that goal of earning enough to live out a comfortable retirement and then have some to have enough to transfer wealth to younger generations. So big changes happening.

ALEXIS CHRISTOFOROUS: That's part of it. It's always just a fine line, right? I mean, you never do know when-- you know, when do we really, as you say, sort of resign for good? But you know, a lot of those baby boomers have worked real hard, so I'm glad to see they're deciding to spend a little more time with those they love and they're getting back to the basics. All right, Stephanie Asymkos, thanks so much for that.