Gone are the days of the guaranteed final salary pension
For my generation (I’m in my mid-forties), the common message growing up seems to have been to get an education, get a secure job, buy a house and pay the mortgage (hopefully before) retirement.
That may have worked for my parents’ generation, but the world has changed and so has the economy.
In today’s fast-paced global society, nothing is secure anymore. Whilst the cost of living in the western world continues to increase, jobs are outsourced to other countries where the wages are lower. Many of the workplace skills needed just a few years ago are no longer current. And humans are rapidly being replaced by automation. If you want an interesting perspective on this, I highly recommend reading Humans Need Not Apply and its prophetic theories about automation.
So what can you do about it? Put yourself in a position to leverage, rather than be replaced by, technology – for starters. Upskill, join the digital world and become an online entrepreneur.
It’s time we all finally recognized that job security is simply a myth. Though I felt comfortable with most of my previous employers, each had the power to cut off my income and turn my world upside down.
Side hustle, part-time job, lifestyle business, residual income, income stream, whatever you want to call it. Do you have a family to support, a big mortgage, or other high ongoing recurring expenses? Or are you dependent only on one stream of income called ‘a job’? If so, it’s imperative that you start thinking of an additional income source, preferably passive.
Even your pension isn’t safe if the state deems it ethical to change the goal posts. My Mum is one of those women born in the 1950s whose retirement age was increased from 60 to 65 by the UK government to repay their lost pensions. 3.8 million women have been forced to wait up to an extra six years to get their pensions after changes to bring women’s retirement age into line with men’s.
The Stocks & Shares ISA fiasco, sub-prime mortgages, the Covid-19 pandemic, need I go on? With a wave of global bankruptcies coming and another recession only a matter of time, don’t wait for the next financial crisis to hit.
Turn the job security myth into a lifestyle reality and start living the life YOU choose. Opt for a recession-proof online income and create your own security. Don’t rely on an employer to offer it.
With bankruptcies in the US alone on target to hit their worst levels in 10 years, experts are expecting even more businesses to suffer as the coronavirus pandemic stifles global economic activity.
My husband works for himself and I was made redundant in the summer of 2020. But we’d already followed our own advice and mitigated this to a certain extent. How? By building ourselves a tiny home and renting our house out to create an additional income stream. Rather than buying another house and downsizing.
It’s madness that in today’s digital world most of us still have all of our income eggs in one basket. And whilst I admire the FIRE movement, the concept of ‘retire early’ doesn’t sit well with me.