Dorothea hits the ground running…
I just finished reading the msnbc.com article posted on the 12-2-07 blog comment about preparing for retirement. The website had a calculator where you can plug in certain numbers (some requiring an incredible amount of foresight, i.e., “how long do you project to live?”)and calculate the amount of money you need to retire comfortably. Well, I was thinking, what would this same calculator look like if we find the answer to Dr. Bill’s question? The universal truth about wealth and aging and retirement? Would the calculator ask you questions like “are you happy today?”, “whose life have you touched this year?”, “how many new friendships have you made this month?”, “were you able to vote this year?”.
OK, maybe I am getting ahead of myself. But as I read this blog, I feel so excited to be a part of the team who will be searching for these answers and creating a meaning out of them.
I am excited too. The point she makes here is that the “retirement calculator” has a built in and unacknowledged bias. It assumes that the needs of older people can be reduced, in their entirety, to financial needs and that the prudent investor must salt away enough financial capital to meet all of those needs. This is the essence of retirement planning, as it is known today.
Dorothea’s hypothesis is that planning for late life should embrace explicit strategies for building both financial and social capital. I think this is very wise.
Of course the people who publish “retirement calculators” make nothing on accrued social capital and, in a bizarre way, suffer when ordinary people (investors) find that they social capital can often function effectively as a replacement for financial capital.