What Retirees Want

11Retiring Retirement: The Rise of Life's Third Age

IN THE FIRST chapter of James Michener's captivating 1959 book Hawaii, he talks about how for millions of years, large tectonic plates were slowly moving and grinding against each other far below the sea that we now call the Pacific Ocean. As these forces converged, masses of land started to rise up from those plates and ultimately surfaced as beautiful Polynesia.

And so it is with the future of retirement. For thousands of years, medical, economic, social, and demographic forces have been shifting and often grinding against each other. From this interplay a new stage of life has been emerging and morphing.

Earlier in our book, we reviewed the modern history of retirement. During what we've called the first era, which lasted throughout history until the early twentieth century, retirement was for all intents and purposes nonexistent. People worked throughout their relatively short lives and they worked until they died.

Then in the 1930s, with economic disruptions and profound shifts in demography and sociology, a second era of retirement emerged. In this one, the safety nets such as Social Security were created and, at the same time, a new point of view took root that suggested that older men and women would be happier if they stopped working and, by so doing, made room for the young.

By the 1970s, employer pensions had proliferated, as did guaranteed health benefits, with Medicare front and center. Longevity was steadily ...