If there is a single word that appears more frequently than any other in the personal finance literature, it is probably “retirement.” The milestone to which it refers is also the overwhelming focus of the multi-trillion-dollar financial services industry. And yet for all the storm and stress on this concept in contemporary Western society, the Torah is (seemingly) silent.
The reason for this is that retirement is a new phenomenon, made possible only in recent times by rising longevity, advances in health care and increased affluence. As recently as 1940, the U.S. average life expectancy at birth was 61 for males and 66 for females, and the concept of retirement was just developing. It was in that year that the Social Security Administration, founded in 1935, began paying retiree benefits. Since Congress set 65 as the minimum age for receiving benefits, retirement was initially conceived as a short period of time. Private pension plans covered fewer than 1 million U.S. workers before 1950, so retirement was only taking its first baby steps around that time.
But in the ensuing decades, life expectancy soared, averaging 74 for males and 80 for females in the U.S. at birth in 2021. More to the point, the life expectancy at the age of 65 is now over 40% higher, accounting for over 5 years of average life, than when Social Security began. Since that time, retirement became a thing, fueled not just by the gains in health and wealth noted above, but in no small way by commercial interests, above all a financial services industry that attracts assets through the marketing of an idealized sort of retirement. Images of graying but physically fit couples at the beach, gazing over a bridge in Paris, flying a kite or golfing became regular features of Madison Avenue’s ad portfolios.
These kinds of pastimes are not as cutting-edge as we might suppose. Rabbi Eliezer Papo wrote in his musar book Pele Yoetz 200 years ago of similar attitudes in his own day. The elderly, after living a youthful life of wild partying, think it fitting to live the same life in an elderly form: sitting with other old people, chattering about money and politics while smoking hookah and drinking coffee.
Travel adventures, massages and golf are extravagances that might make life more pleasant but not more meaningful. These escapist thrills, when they become the focus of life, detract from the wisdom and dignity of the elderly. Not that there is anything wrong with any of these activities per se, but the overall ethos of juvenile partying for a decades-long stretch is exactly the opposite of Torah thought on aging.
The Pele Yoetz recommends a different kind of life. Instead, he says, conscious of the impending Day of Judgment, one should use his remaining time more wisely:
He should cleave to sages and books that teach man knowledge. And he should open his eyes to all his issues, and not waste precious time while he is free…All that is in his power to do, he should do: rectifications, learning, mitzvot and good deeds at an increasing rate, until he separates from the vanities and pleasures of this world and conducts himself with piety, that he might gain favor and say, “Fortunate is my old age which atones for my youth.”
You’re not likely to see anything like that in your mutual fund retirement brochure!
The Torah only seemingly does not address retirement because retirement, in its modern form, is a new and perhaps passing fad. For all too many, the U.S. retirement dream is becoming something of a nightmare. This is because it takes an awful lot of money to support daily living for decades without work, such that retirement systems are strained to the breaking point at every level. U.S. Social Security is no longer self-sustaining, and will soon be unable to pay out full scheduled benefits – which are already tightly strained in providing for everything a retiree needs, not only in food and shelter, but also in medical care or home health aids, which cost hundreds of thousands of dollars over the course of retirement, something pre-retirees don’t always take into consideration. So Social Security is clearly far from sufficient.
The various state pensions and corporate pension plans – for those lucky enough to be participants – are similarly stretched, and a disturbing trend we’ve seen in recent years is that some of them have tried to make up for this funding gap by investing their portfolios more aggressively. Many large institutions collectively adopting such an approach introduces greater systemic risk to the financial system, which has proven to be crisis-prone.
If the public pension systems cannot be relied upon, households must bear a greater share of the burden, but there too we have massive underfunding for retirement through 401(k) and similar plans, while consumers run up higher and higher personal debt and homeowners turn their houses into brick-and-mortar credit cards by borrowing against the equity in their homes.
These dystopian trends suggest that the blessing of a long life may turn into the curse of becoming a burden on adult children who themselves are struggling to maintain their households. In other words, the glamorous retirement we’ve all been promised may turn out to have been a brief historic interlude, for all but the wealthiest Americans.
(Global pension systems across the globe are strained, but we use the U.S. as a representative example. In fact, all countries with large Jewish populations – the U.S., France, Canada, the U.K., Argentina, Russia, Germany, Australia and Brazil rounding out the top 10 – have more problematic national retirement systems than Israel’s, where, despite its deficiencies, retirement is more achievable for citizens of average means because the health care is essentially free and the banking system discourages taking on excessive debt.)
In light of these very real trends, it appears that the Torah’s guidance on aging exactly corresponds with reality by establishing a framework of mutual responsibility, whereby the older generation must avoid burdening their children, who in turn must exert themselves to support parents who lack the means to do so themselves.
Torah law provides for old age by prescribing that children support their elderly parents, if they are unable to support themselves. Unlike Social Security, expenditure of resources is only required when the parents actually lack the resources to provide for themselves, and the expenses are borne by the children rather than the community. Only if one made it to old age without the resources needed to ensure independence are younger family members called upon to assume responsibility for their basic needs, and only if the children are incapable of providing for their parents is recourse made to charity from communal funds. The Rambam brings this as a son’s halachic obligation to his parents:
What is honor? Providing food and drink, dress and clothing, from the father’s property. If the father lacks money but the son has, he is compelled to sustain his father and mother to the extent he is able.
The Rambam adds that though we are commanded to assume financial responsibility for our parents who cannot do so for themselves, “a person is forbidden to lay a heavy yoke on his sons.” While the Torah grants parents with no property the right to demand basic provisions from their children, they are not only discouraged but also disincentivized from doing so, as the expenses fall on their future heirs first of all.
Putting this together with what we have learned from the Rambam about lifecycle financial planning, we can frame “retirement” thusly. While we can and should set positive goals for ourselves, it is wiser to start with a “first, do no harm” perspective. That is, we should above all plan not to become a burden on our family and community. Therefore, to avoid a problem that could affect one-third of one’s life, we need two things: income and assets. Young people should be consciously thinking about this and planning this before marrying.
This is especially true in the U.S., where it is now common for young people to begin their adult lives saddled with student loan debt averaging $33,000. (Once again, this is not generally a problem in Israel where higher education, religious or secular, is affordable.) Young people should not start out life with a crippling level of debt. Rather, they should work hard to get a scholarship or work hard to fund a yeshiva or university education program themselves, and of course think about why they are pursuing such an education so that they not waste time and resources.
To summarize all of this, what currently goes under the name of retirement may be better thought of as organizing one’s financial life to achieve financial independence. This is accomplished by living within one’s means while reserving a portion of one’s income for the future purchase of assets such as a home, a rental property and a stock index fund. With these assets, a household can withstand financial crises that occur from time to time and generate income that can finance current needs when one no longer wants to work or no longer can work. This ensures the asset owner will not become a burden on his family but to the contrary can leave a legacy through tzedakah or bequeathal to heirs.
 Period life expectancy data from The 2022 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds, Office of the Chief Actuary, 2022,
 Life expectancy at age 65 was 11.9 for males and 13.4 for females in 1940. In 2021, life expectancy at age 65 is 16.9 for males (42% higher) and 19.5 for females (46% higher).
 Pele Yoetz, entry Zaken.
 Hilchot Mamrim 6:3.
 Hilchot Mamrim 6:8.
 Justin Song, “Average Student Loan Debt in America: Facts and Figures,” ValuePenguin, accessed August 2, 2022.