Retiring and staying retired ranks high on working American’s list of priorities. Our endgame is retirement – the faster we get there, the better. Retirement makes life worth living, right? We dream of doing all the things we want to do and none of those we don’t. So, how to have a happy retirement?
Travel, time with family, volunteer work and good old R&R fill our dream boards for life’s later years. We spend three-quarters of our life working up to the part we actually want to live. That life we’ve been living towards often falls short of our dream life. We are left with precious little health (thanks to overworking) and precious little money (despite overworking) to enjoy life after 65 (or 62 for the lucky).
Is there another way? Can you experience those retirement highlights now?
Other countries do just that — enjoy life throughout the decades rather than longing for the last few to hurry up and get here. The Fun Four: Australia, Sweden, Switzerland and the Netherlands rank high on both the World Happiness Report 2018 and the Bloomberg Global Health Index 2017. Could this be true for America? What would it mean to your health and wellbeing? Does this change the picture of retirement?
Let’s dive into it.
The Fun Four: Live Happy and Healthy
The World Happiness Report ranks Switzerland fourth and the Netherlands sixth, while Australia and Sweden tie for ninth on the list of the happiest countries. The Bloomberg Global Index lists Switzerland third, Australia fifth, Sweden eighth and the Netherlands thirteenth for health.
What can we learn from these Fun Four countries?
Mandatory Time Off
In the Fun Four countries, taking significant time off is mandatory. Paid vacations and holidays encourage R&R throughout the year. Australians get 20 to 25 days of vacation and 10 holidays, all paid. Sweden gives its workers 25 days of paid vacation and 9 commonly paid holidays. Switzerland offers 20 and 7, respectively. The Netherlands weighs in with 20 days of vacation.
Furthermore, workers in these countries retire over two and a half years later than Americans, working an average of 222 hours less per year than Americans. Americans clock 44 hours per week on average, with three of the Fun Four coming in under 40 hours per week.
Jan-Emmanuel De Neve, professor at the University of Oxford’s Saïd Business School, co-authored the Happiness Report’s happiness at work chapter. She told CNN, “Work-life balance, job variety and the level of autonomy are significant drivers” for happiness on the job. More time off and fewer work hours encourage work-life balance for the Fun Four.
RECAP: Working fewer hours and using vacation time adds up to a healthy work-life balance.
Strong Social Networks
“Happiness is a result of strong social foundations,” said Jeffrey Sachs, The World Happiness Report co-editor and Earth Institute director. “It’s time to build social trust and healthy lives.”
Countries which top the Happiness Report highly value six key variables, one of which is social support.
Gallup published data which reveals a worldwide association between strong social ties and self-rated health. People with family and friends to call on report greater satisfaction with their personal health. The study was the first to find evidence across income levels and geographic regions of this support network.
The Happiness Report also found that social foundations impact perspective — and perspective matters. John Helliwell, co-director of the Canadian Institute for Advanced Research, said, “high levels of mutual trust, shared purpose, generosity, and good governance” make life’s ups and downs seem easier.
RECAP: Work-life balance includes social interactions which lead to greater life satisfaction.
Healthy Diet and Exercise
Bloomberg suggests Italy’s rank as the healthiest country may have something to do with its heart-healthy Mediterranean diet. While other countries topping the list do not share this diet, fresh, locally-sourced foods may be the common link. The Fun Four eat simple foods with plenty of dairy. Some add wine. Healthy individual lifestyles lead to a healthy country.
Two-thirds of the Netherlands population, ages 15 to 75, participates in weekly sports. In Sweden, half its population gets involved in the nationally organized sports movement. Nearly 25 percent of Australians engage in regular sporting activities, an important part of Australian culture. And, most Switzerland residents choose a regular sports activity with 25 percent active in an organized sports club.
RECAP: Work-life balance includes active lifestyles and healthy nourishment, leading to healthy, happy countries.
The American Way: Work Hard, Retire Exhausted
The U.S. ranked fourteenth in the World Happiness Report, dropping from thirteenth the year before. On the Bloomberg Global Health Index, America came in thirty-fourth earning a health grade of 73.05, significantly down from the number one country, Italy, which scored 93.11.
What does this mean?
The Reality of Overwork
Figures put out by the Bureau of Labor Statistics report only a slight rise in American’s work hours, just above 40 hours per week. Experts believe the actual number to be much higher due
to the difficulty in tracking with fewer time clocks and more mobile offices. Other Bureau reports indicate 25 million Americans work greater than 49 hours a week, with 11 million working 59 hours a week. The number of children in daycare, demand for after-school care, and the increase in road rage point to a growing and stressed workforce.
Two-income homes, even if one partner works part-time, means less time for leisure. Evenings and weekends are spent tending to the household chores traditionally done during the day. In the past, one spouse worked at the office, and the other worked on the house. This arrangement, now disappearing, allowed for more leisure time as a family because the upkeep of the physical home didn’t have to consume all spare time available to the family. In short, Americans work harder and play less in modern times.
Is all this work paying off? Are we getting to retirement quicker and in better shape?
Nearly half of Americans arrive at retirement financially unprepared. A GOBankingRates survey predicts 42 percent of U.S. workers will retire “broke”. Americans say, “I do not make enough money”. In reality, longer life expectancies and insufficient planning end retirement dreams before they begin.
The actual age of retirement for Americans, on average, is 63. We might like to think early retirement dreams do come true. However, health-related issues and disability speed this need for early retirement, not planning done in advance. Overworking ourselves to get ahead, even get to retirement in better shape, leaves Americans looking to enjoy life when physical and mental health wanes.
The Individual Cost
When work trumps play, it costs health and happiness. The treadmill which promises the American dream, complete with a comfortable retirement, fails to deliver anything but exhaustion. When work and life tip out of balance:
Personal Relationships Suffer.
Family and friends are the first to feel the heat of extended work hours, in your absence and your stressed interactions. Joseph Grano, CEO of Centurion Holdings writes in his book, You Can’t Predict a Hero, “You can’t work the long hours that success requires and can’t set the individualistic priorities that ambition dictates without stealing somewhat from your loved ones.”
Creativity and Productivity Take a Hit.
A study out of Boston University’s Questrom School of Business found no evidence that employees who worked more accomplished more. Other studies reveal impaired memory, health problems, plus increased absenteeism and turnover rates which negatively impact productivity. Further research finds predictable, mandated time off improves productivity.
Cary Cooper, professor at Manchester Business School in the U.K. told Business Insider burnout in the U.S. is a bigger problem than elsewhere. Mounting scientific evidence details the impact of burnout on the brain and body. Article after article reports the rise in burnout among U.S. workers. And, the stats confirm it.
Studies indicate cognitive decline accompanies overwork, not just at the moment but over the long haul. The physical impact of all-work-and-no-play ranks high as well. Working more than 55 hours per week increases stroke risk by 33 percent. Heart disease, mental illness, type 2 diabetes, obesity and other physical conditions also increase with added work hours.
The National Cost
The American struggle with work-life balance hurts the health and happiness of the nation. National health expenditures continue to climb. Health spending increased from $350 per person to $10,348 over four decades (1970 to 2016). Nearly 18 percent of the U.S. economy is devoted to health expenses, up from 6.9 percent in 1970. Public health costs carried by the state and local governments continue to grow yearly as well.
Obesity, the reason for the U.S.’s low score on the Health Index, remains a top health concern. It costs America over $150 billion yearly and billions more when lost productivity factors into the equation. Accompanying conditions like type 2 diabetes, high blood pressure and heart disease further raise expenses. The U.S. ranks ninth in the prevalence of obesity among all countries, first on the list of industrialized nations. (The Fun Four rank on the lower half of both lists.) While participation in sports and exercise is on the rise, averages in the States (just 19.5 percent in 2015) fall far below the Fun Four. And, the percentage for those over age 24 drops even more. Rather than a cross-generational, national movement, sports play in the U.S. correlates with school involvement and level of education. Exercise tends to be relegated to the weekends, nonworkdays and evening hours — when time permits.
Insufficient work-life balance also damages American productivity. Research reveals productivity decreases as hours worked increase. Australia, Switzerland, and Sweden (with less than 40 hour work weeks) rank in the top five most productive countries. The U.S. comes in eighth (while landing at number five on the list of countries with the most hours worked per year).
The question begs to be answered: Are all those extra work hours, stress and health issues worth it? The data is saying, “no”.
An Alternative Reality: Balance Work and Life
What do these stats mean? You still may be tempted to think the costs of extended work hours return significant benefits — keeping your job, putting your children through private school, building a retirement nest egg. But, the wear on body, mind, and nation say otherwise.
Could work-life balance in America be a reality? Placing a higher value on work over play is decidedly American. Transitioning from a work feverishly-until-retirement state of mind to a work-less-play-more attitude is no small feat. Let’s consider what this might look like.
The average American work week falls around 47 hours, competing for the top spot in the world.
The Working Time Directive in Europe caps work weeks at 48 hours. Cary Cooper, American-born and working in the U.K. says, “Sweden and some other countries realistically work about 35 hours per week.”
The typical American workday begins earlier in the morning and ends later at night — with a disappearing lunch hour. Only 20 percent of U.S. workers stop for lunch. The rest eat at their desks or not at all. Most of the 20 percent taking a lunch break are mandated to do so by their company. Many European countries require an hour lunch break. When the workday ends, mobile technology gives people 24/7 access to one another. We make maximum use of these digital tools in the States. Craig Stroti, author of Communicating Across Cultures, says this habit annoys other countries where time outside the office is reserved for non-work activities. “The perception is Americans, they don’t stop working. Europeans see that as being inefficient.”
Tips for Work-Life Balance:
- Adopt a shorter workday.
- Create a community around lunch breaks.
- Mandate breaks in your workplace.
- Limit the hours you send or respond to email and other work communications.
- Reserve evenings and weekends as no-work zones.
On average, U.S. companies offer two weeks of vacation per year — significantly less than other countries. Still, Americans only take half the allotted time. Engaging in the leisure and active pursuits required to be healthy and happy becomes difficult if we do not take time off. What drives us to turn in these hours and give hundreds of dollars back to our employers? “Fear,” Scott Dobroski, analyst at Glassdoor, told MarketWatch. Fear of getting behind. Fear that no one else can do the job well. Fear of not appearing dedicated. Fear of being replaced. Fear of missing out. Fear of losing jobs.
Other countries mandate vacation, offer paid vacation and holidays and support paid parental leave to ensure their employees take needed time off. Some European countries legally guarantee 20 to 30 compensated vacation days per year. In Sweden, one of the Fun Four, working five days a week earns workers 20 days vacation annually. U.S. family leave policies are grossly underused as well, not to mention terribly underdeveloped. An International Labour Organization (ILO) report gives all states but two a failing grade on their leave policies. America is one of a handful of countries worldwide not offering financial support for parents. Check out these maps of how we compare internationally on time off and leave.
The Fun Four? Switzerland guarantees maternity leave for 14 weeks, and their federal constitution does not permit mothers to return to work before eight weeks. They earn 80 percent of their wages on leave. The Netherlands gives new moms 16 weeks of 100 percent paid leave. Australia offers both parents 12 months of leave with 18 weeks paid. And, Norwegians take 36 to 46 weeks with 100 percent pay initially, 80 percent wages for the remainder.
Tips for Work-Life Balance:
- Encourage your company to guarantee vacation time.
- Mandate employees use allotted vacation hours.
- Improve job security.
- Allow for and provide financial support for longer family leave.
- Legislate for better state and federal work vacation and leave policies.
Enjoying life along the way means working less and spending more through the course of your lifetime. This approach may take longer to save up for retirement. However, your health and happiness are at stake.
Consider the benefits:
- Social Security benefits increase when you retire later.
- Fewer years of retirement means less savings required.
- Life experiences occur before unexpected or age-related illness occur.
- Health issues may decrease as overworked individuals find balance.
- Retirement may find you healthier and happier.
It works in Switzerland. A Global AgeWatch Index indicates Swiss seniors enjoy the best retirement in the world, according to USA Today. Despite working fewer hours per year, the Swiss retire comfortably thanks to an efficient pension program, diverse funding and financial planning. Switzerland’s high cost of living does not prevent residents from affording the necessities and even some luxuries after retiring. The other countries of the Fun Four offer similar support through pension systems, government minimums for retirement and diverse funding options.
The U.S. ranked ninth on the Global AgeWatch Index. Sixty-eight percent of Americans are financially ill-equipped for retirement, with 33 percent of retirees relying solely on Social Security for expenses after a lifetime of work. Fifty-one percent have no private pension coverage. Switzerland and its Fun Four compatriots retire later. Norway boasts the highest retirement average at 67.75 years. The Netherlands Dutch retire at age 65.75. In Australia and Switzerland, 65 is retirement age (though the Swiss want it raised to 67). Sweden’s workforce retires at 64.5.
Later, yes. But, healthier, happier — and in better financial shape.
Tips for Work-Life Balance:
- Diversify retirement funding.
- Legislate for mandatory pensions.
- Develop a comprehensive financial plan.
- Contact a financial planner for insight.
- Rework your life plan. Get comfortable retiring later.
Your Dream Life: Make it Happen
Does this all sound like a dream? Is your American brain wired to distrust the stats on this? The reality is Americans, including executives, entrepreneurs and physicians have adopted this lifestyle. In their busy professions, they make it work. You can, too.
Here are a few tips to get started experiencing the benefits of taking time off along the way:
Where do you want to be in five years, 10 years, after retirement? What do you want your life to
look like now and in the future? What are your possibilities? Take time with family and friends to
dream your ideal life plan. Remember to include bucket list items in the years before retirement.
What would you do with an extra four weeks per year?
- Engage in quarterly mission trips
- Spend summers on the beach
- Rebuild a vintage car
- Take one-month, yearly tours of Europe
- Volunteer weekly with the homeless
- See the Seven Wonders of the World
- Improve your home or landscaping
Dreaming leads to excitement. Avoid jumping in at this stage. Without a plan, you are likely to veer off course. As you dream, jot down your thoughts. Once you finish, take time to:
- Narrow down your top ideas.
- Lay them out on a timeline.
- Set SMART goals.
- Reduce your expenses.
- Create a budget.
- Set money aside for your goals.
- Stick to the plan.
Talking with a financial advisor as you plan helps your goals and budget stay realistic. Keeping a written copy of your dream plan provides encouragement for days when you are low. Visualizing where you are headed brings inspiration.
Now, take action. Put your work-life balance plan to work for you.
- Adjust your work hours and after-hours work habits.
- Build rest and relaxation into your schedule.
- Develop strong social support networks.
- Add physical activity and healthy eating to your routine.
- Resist the American norm to place work over play.
- Revisit your plan yearly to dream and rework as needed.
- Work less. Play more. Retire later.
Waiting to live the life you deserve — well — it might never happen.
The New Endgame: Balancing Work and Life
The imbalance of work and play makes Americans slaves to work, fear, declining health and decreased happiness. The Fun Four provide successful examples to inspire Americans to take back our freedom. After all, our country was founded on this principle. Rushing to retire is unnecessary when you enjoy your passions in every decade of your life. Forget pining for the someday of retirement. Create a financial plan that addresses today as well as your future with the activities that fulfill you. Health and happiness are sure to follow.
Contact Signature Wealth Strategies today to hear about our innovative A-to-B Planning Process. This outcome-oriented method gives you the insight and strategies to live your dream.