Lessons from the lab: cooking up a new retirement

Joseph Coughlin’s evolution from urban studies professor to longevity expert began with an age‐old question: What should we do about older drivers?

Back in 1999, a consortium of insurers and auto makers approached Coughlin, a professor at Massachusetts Instituteof Technology, about funding new research on how to make driving safer for elderly drivers and for everyone else sharing the road with them.

The MIT AgeLab was born.

“It’s a topic trapped between humor and horror,” said Coughlin, the AgeLab’s director, of the older‐driver question. “What we sought to do is understand not how old an old driver is but rather how new technology could be used to enable people to remain mobile.”

Coughlin’s research begat Miss Daisy—a driving simulator in the body of a Volkswagen Beetle—that is currently housed in the AgeLab’s Cambridge, Mass., headquarters. The AgeLab uses Miss Daisy to test the reflexes of over‐age‐50 volunteers and gauge the impact that distraction, disease, medication, and in‐vehicle technologies have on their driving abilities.

Surya Kolluri, head of the TIAA Institute, recently took Miss Daisy for a (simulated) spin before sitting down with Coughlin to discuss the AgeLab’s work and Coughlin’s best selling book, The Longevity Economy: Unlocking the World’s Fastest‐Growing, Most Misunderstood Market. Below is an excerpt from the conversation, edited for length and clarity.

Surya Kolluri: At TIAA, we think a lot about how longevity plays into retirement planning. There’s a question I’ve heard you ask that hits home, which is how many days in retirement does the average person have after turning 65. What is the answer?

Joseph Coughlin: The answer, generally speaking, is 8,000 days. But let’s give it some context. From birth to 21 years of age—let’s call it childhood—is about 8,000 days. From 22 to mid‐40s or midlife crisis is about 8,000 days. From mid‐40s to around age 65—retirement age—is also about 8,000 days. And the fastest‐growing part of the population is 65 to 85, which is another 8,000 days. So what we call retirement today is not a brief trip to Disney and a few beach walks with the grandchildren. It’s actually one‐third of your adult life. It’s an entire life stage.

Kolluri: What does this mean for financial advisors helping people plan for retirement?

Coughlin: Longevity literacy should not be just: Okay, I’m likely to live this long, so this is how much money I need. It should be about preparing for the things that you will be doing and needing at an older age. It’s a more complicated discussion.

Kolluri: What type of preparing?

Coughlin: At the heart of the AgeLab’s work is infrastructure risk. For example, have you thought about whether where you’re living today is going support you living tomorrow? More than 80% of us want to “age in place”—that’s geek speak for your marriage, your mortgage and your memories all in one house. But what happens if the house is two stories and your knees are giving out? That’s a risk that needs to beprepared for.

Kolluri: Finally, let’s talk about how longevity affects the workplace. With more people delaying retirement, one executive search firm thinks older employees may be blocking younger colleagues coming up through the ranks.They’ve suggested companies adopt a so‐called “legacy track” for older employees who still want to contribute but may not want to work full‐time.¹ Do you see companies adopting such a track?

Coughlin: Employers do need to think more creatively about sliding people into different positions and about offering flexibility. At the same time, we also need to socialize our employees to realize that just because they have 35 years on the job, it does not mean you keep the same pay grade if you change slots or change tracks.

We see universities trying to do that with emeritus professors, who still have an office and privileges and still sit on committees. We see companies like IBM, Proctor & Gamble, and Glaxo Smith Kline that have created pools of experts from their retiree population they can draw upon for the business. So individuals need to be re‐socialized on expectations, but institutions need to come to grips with offering flexibility and purpose.