Useful Or Youthful? What’s The Best Role For Retirees?

What does it take to live well in retirement? Good health, sound finances, supportive family and friends, and a fourth ingredient – a strong sense of purpose in life. Retirees with strong purpose are happier and healthier, more active and socially engaged, and they live longer. Marc Freedman, CEO of Encore.org and author of How to Live Forever, describes purpose as “feeling like the world needs you as much as you need it, that you have something to contribute and that you still matter.” Retirees with purpose don’t just stay busy, they make retirement the most meaningful and fulfilling time of their lives. They want to feel useful even more than youthful.

Purposeful Retirement

People’s sense of purpose typically changes and often intensifies in retirement. Family and friendships become even more important and valuable, and retirees say they derive their strongest sense of purpose from spending time with loved ones (see chart). Inner purpose grows as people reinvent themselves in retirement, learning and doing new things on the one hand, and becoming more reflective and wise on the other. Social purpose expands as retirees have more time to volunteer and support activities and causes they care about. Some develop new sources of purpose they didn’t even anticipate.

Retirees find purpose in many places and ways. Some go back to school to develop new abilities and enrich their lives through learning. Some travel with purpose to immerse themselves in different cultures, including by merging travel with volunteering in “voluntourism.” Some volunteer in their communities in food banks and a variety of other social services. Some are active volunteers in their churches or senior living facilities. Some launch encore careers as teachers or helping nonprofits succeed in their missions.

Many retirees derive their greatest sense of purpose in being “generative,” in nurturing younger generations. The focus is often on supporting their own children and grandchildren.  Over 70 million Americans, and 90% of those over 65, are grandparents, and their generosity goes far beyond birthday gifts and occasional outings. Grandparents now serve as the primary childcare providers for one-fourth of preschool children, and children’s confidence and ability to thrive increase when grandparents are active in their upbringing. Grandparents also invest directly in their grandchildren’s futures by contributing to educational expenses and college savings plans – an aggregate annual contribution of over $34 billion.

Intergenerational purpose increasingly extends beyond one’s personal family. For example, many of the new careers people launch with Encore.org’s help involve teaching and mentoring. Collaborating with more than 250 partner organizations, Gen2Gen helps youth-serving organizations tap experienced talent and “tell a new story” about the benefits of intergenerational connection. In one such organization, “Grandpas United,” by partnering with schools and libraries, the men serve as role models and mentors for children without enough caring adults in their lives.

Age Wave’s recent research with Edward Jones and The Harris Poll reveals the enormous potential for social contribution and intergenerational connection through mentoring. Half of Americans age 50 and over would like to serve as a mentor, helping others with school, work, or other activities. And more than half of those under 50, including two-thirds of Gen Z, say they would like to have a mentor.

The Upside of Aging

Retirees have the key ingredients. They have the time, an average of over 70 hours of discretionary time per week for those 65 and older. They have the money, holding far more savings and other assets than younger age groups do. And they have the accumulated skills and experience to lend to their volunteer work and other purposeful activities in retirement. They say that retirement is the best time to give back, and 84% say they have more to contribute in retirement than when they were younger.

The massive influx of Boomer retirees should take donating and volunteering to new heights. The Boomers have always been a cause-oriented, change-the-world generation. In retirement they want to contribute not just with money, time, and labor, but with their talents and experience. They research where to donate and how to volunteer, because they want their giving to have impact, local and global. The Boomer generation contributes 2.2 billion hours of volunteer time annually, with a conservatively estimated value of $54 billion. We expect this number to grow.

As more people enjoy longer retirements, during the next two decades we estimate more than  $7 trillion in donations and an additional 63 billion hours of volunteering, which translates into nearly $2 trillion worth of services. We call this enormous opportunity to do social good “America’s Longevity Bonus.” This aggregate capacity for giving time and money totals nearly $9 trillion in value in the United States alone. Globally, the longevity “give-back” bonus might approach $100 trillion.

Giving Gives Back

What motivates retirees to give and volunteer? By far, the greatest reason is simply “making a difference in the lives of others,” as over 80% tell us (see chart). Those who volunteer also cite the desire to stay mentally and physically active, and to develop and deepen friendships and relationships. At a more emotional level, gratitude is a motivator. Grateful for what they have in life, retirees want to share. Many look back upon help they’ve received through their lives and want to “pay it forward” to those in need today.

Giving has an anti-aging effect. Retirees who give and volunteer have higher self-esteem and report being happier and healthier. Research shows that helping people in need brings happiness to far more retirees (76%) than spending money on themselves (24%) does. Volunteering builds social connections that can make up for workplace connections lost in retirement. And intergenerational connections are mutually beneficial. Over 90% of Generations United survey respondents believe that elders benefit from building relationships with children and vice versa. To quote Marc Freedman again, “The real fountain of youth is the fountain with youth.”

Whether the focus is inner development, family relationships, or social contribution,  purpose itself pays off in a big way. Dr. Charlotte Yeh, Chief Medical Officer for AARP Services, Inc., points out that older people with strong purpose have fewer health problems, lower health care costs, and longer lives. And more fundamentally, they enjoy more of life: “If you have a strong sense of purpose that gets you up in the morning, and people to do it with, your possibilities become endless.”

It’s Time for a Global Elder Corps

Even with the force of the demographic age wave,  retirees remain an under-tapped resource for doing social good. Only about one-quarter of retirees regularly volunteer, more so women (29%) than men (22%). Those who volunteer regularly average about one day a week. Meantime, retirees watch, on average, 48 hours of television per week. With all their time affluence, older Americans spend only a small fraction – under 4% – of their discretionary time volunteering. Everyone would be better off if this number rose.

Americans of all ages are beginning to recognize this missed opportunity. In a recent study conducted by Age Wave and Edward Jones, nine in ten feel that there should be more ways for retirees to use their talents and knowledge for the benefit of their communities and society at large. An equivalent percentage say they wish that older and younger generations took more time to connect with and learn from one another.

Charitable and community organizations need to crack the code of better engaging retiree volunteers, starting with enlisting Boomer retirees’ skills and experience, not just their time and labor. And retirees should spend more time exploring opportunities through organizations like VolunteerMatch.org and community initiatives like AustinUP.org and Boston’s Age Strong. Volunteer organizations including FosterGrandparents.com, Service Corps of Retired Executives, and AmeriCorp Seniors do great work at significant scale. But just imagine the potential of a full-force Elder Corps numbering tens of millions – retiree capacity meeting social need.

As the COVID-19 pandemic has raised awareness of our interconnectedness and concern for the social good, it’s driven an increase in volunteering. Given their greater health risk, retirees are more likely to be contributing remotely, and many are no doubt frustrated in their ambitions to volunteer. As vaccination helps bring the pandemic to an end, we hope that social commitment remains strong, and people of all ages can volunteer in person and with renewed purpose.  

We end our book What Retirees Want and Ken’s new Public Television special “Life’s Third Age” with a call for retirees to be more active and more activist in their Third Age. The potential is amplified if retirees invest their time, energy, and ability not just to do immediate good, but also to nurture younger generations and build for the future. Or to put it metaphorically, to plant trees in whose shade they may never sit.

This is the last in a 10-part series on “The Future of Retirement” that we have posted over the last three months. If you are interested in better understanding what’s ahead, we invite you to check out our new book What Retirees Want: A Holistic View of Life’s Third Age.