My new book, How Do I Get There From Here? is due out in August from the American Management Association (AMACOM, publisher). In it I cite Financial Literacy and the importance of being able to work with a great financial advisor, as key competencies in the New Normal.
I recently attended a Financial Literacy Day conference arranged and sponsored by the excellent Cumberland Advisors. During this well-crafted, expertly delivered one day workshop, I found myself looking around the room wondering not only about the all-important issue of Financial Literacy, but also about Life Literacy in the New Normal.
Here are some examples of the need for New Normal Life Literacy in my own network:
Sally, 56, didn’t just lose her job. She lost her employer (the one she had spent years working for) because it failed to keep ahead of the market and industry. It went out of business.
Linda and Bill, both 60, have known for a long time that they weren’t saving enough for retirement. They avoided the topic regularly. Recently one of their friends filed for bankruptcy at 58, and they experienced this as a wakeup call for themselves. Suddenly they admitted they were in the New Normal and needed to get a realistic plan together but didn’t know where to start.
Tom, 72, didn’t just find himself alone. He found himself suddenly divorced; a statistic in a growing trend of later in life divorces.
Judi, 75 and long divorced, had a big communications job with a major New York company. When she finally retired in Florida, she thought she would never work again. Money was no problem. Three years after retiring she went to work as a hotel concierge 3 days a week. Why? She hadn’t known in advance that social diversity would be so important to her quality of later life. She also hadn’t known in advance that she wanted a job she could leave behind at the end of the day. She loved her community of residential peers, but as she said “I’ve got to get out of the house and into someplace with interesting people who work and talk about other things. I don’t want to work full time, but now I can also see through my new work what a trap retirement would have been for me.”
Max and Rose, 83 and retired, just received a letter from Max’s former employee letting them know that the company will no longer sponsor health care coverage for retirees. They were given 6 weeks to find their own coverage.
Lilly, 84 and a widow, is still healthy and vital. She is daily tennis player and theater devotee. Her financial advisor has begun to warn her that although she and her late husband did a great job of saving for retirement, they had expected to die at 86 and only saved to that age. She shows no signs of slowing down, doesn’t want to, and is wrestling with the reality that she’s going to run out of money. Suppose she lives to 95? Where is the other 9 years of money going to come from? What work-for-pay opportunities are available to a talented 84-year-old woman who hasn’t worked for pay in 20 years?
We lived in the Old Normal for many years. We were highly life literate. Characterized primarily by slow, continuous, predictable change, we became adept at the use of several Old Normal Tools. One we seem to like the most is: Treating every situation as a problem that can be solved and permanently moved beyond.
Welcome to the New Normal. It isn’t going away any time soon. It’s characterized primarily by game changing, seemingly sudden, discontinuous change. Life literacy is needed now more than ever, yet many of us are not life literate in the New Normal. In my opinion we are all going to have to become adept at the use of New Normal tools. One we seem resistant to (but is nonetheless of critical importance) is: Stopping dead in our tracks to examine and reflect. We need to ask and answer for ourselves the important questions: What’s really happening here? How does it affect me/us? What’s an intelligent way forward from here in this New Normal?
This, of course, places traditional planning (financial, legal, retirement, health, career, political, life, relational) in a whole different light. Making sure we will have enough money for retirement won’t be the place to start. Instead, we’ll have to create incremental plans first so we can work with our financial and other advisors more wisely.
Which leads us to self-ranking in a moment of quiet and pure self-honesty. Let’s be clear. I’m not asking you to rank how happy you are with the New Normal, nor how excited or afraid you might feel about it.
How literate are you about yourself, your life and your plans in the New Normal? I’m asking you to rank your own willingness to develop New Normal Tools and your current, demonstrated abilities to work with them (1/low to 10/high).
Please let me know how you ranked yourself, what your approach to the New Normal is, and what I should be writing about that would be additionally helpful. Thanks.
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