The Retirement Crisis Nobody’s Talking About: Why We Plan Our Pensions But Not Our Purpose
Retirement is one of the biggest transitions in life. So why do we spend decades preparing financially and almost no time preparing psychologically?
We plan meticulously for the financial side of retirement. We build pension pots, consult financial advisers, calculate projected income, and model different scenarios for when to stop working. By the time most professionals reach their late fifties or early sixties, they have a reasonably clear picture of whether they can afford to retire.
What almost nobody plans for is the psychological side. The loss of identity. The disappearance of structure. The quiet, disorienting question that arrives uninvited on a Tuesday morning three weeks after the leaving party: who am I now?
This is the retirement crisis that nobody is talking about. Not a financial crisis — a crisis of purpose. And it is affecting far more people than most of us realise.
The evidence is striking
A 2020 meta-analysis published in the journal Healthcare, drawing on eleven studies across the United States, Greece, Australia, Singapore, Spain, France, and Canada, found that the pooled prevalence of depression among retirees was 28 per cent. To put that in context, the World Health Organization estimates that depression affects approximately 5 per cent of the general adult population worldwide. The meta-analysis found that depression was most common among those who experienced mandatory or involuntary retirement, suggesting that control over the transition matters enormously.
A longitudinal study using data from the Health and Retirement Study in the United States, published in Psychiatry Research, found that retirement led to increased depressive symptoms over time — and that the relationship was bidirectional, meaning depression also increased the likelihood of early retirement. The researchers concluded that practitioners should try to identify older workers at risk of depression before the retirement transition, rather than waiting until difficulties emerge afterwards.
In the United Kingdom, the Mental Health Foundation reports that depression affects around 22 per cent of men and 28 per cent of women aged 65 and over, yet an estimated 85 per cent of older people with depression receive no help at all from the NHS. This is a staggering treatment gap for a population going through one of life’s most significant changes.
And it is not only about clinical depression. Many retirees experience what researchers describe as a loss of role identity, social disconnection, and a decline in perceived purpose — a constellation of experiences that may not meet the threshold for clinical diagnosis but profoundly affect quality of life, relationships, and health.
Why purpose matters more than money
The financial planning industry has done a remarkable job of convincing us that retirement readiness is a numbers game. And of course, financial security matters. But a growing body of research suggests that purpose may matter just as much — if not more — for long-term health and wellbeing after retirement.
A landmark Japanese study published in 2008 found that older adults who lacked ikigai — a Japanese concept meaning a sense of life worth living or purpose — had a 50 per cent higher mortality rate over seven years compared to those who reported having it. A more recent US study of adults over 50 supported these findings, showing that those with the strongest sense of purpose were at least half as likely to die within eight years compared to those with the weakest.
Research published in Age and Ageing in 2025 confirmed that the number of peer-reviewed studies on ikigai and ageing has quadrupled in the last decade, reflecting a growing scientific recognition that purpose is not a soft concept but a measurable determinant of health outcomes. The research identifies three core components of ikigai: life satisfaction, challenge and personal growth, and recognition of social role — all of which are directly disrupted by retirement.
Longitudinal research on Japanese older adults published in The Lancet Regional Health found that ikigai was associated with reduced psychological distress, improved subjective wellbeing, and greater resilience in the face of stress. The researchers noted that people with a higher sense of purpose tend to perceive stressors as less threatening and recover from negative events more quickly.
The implications are clear. Purpose is not a luxury. It is a health intervention. And yet, while we spend years building pension funds, we spend almost no time building purpose funds.
The identity gap
For many professionals, particularly those in senior roles or public service, work is not just what they do — it is who they are. Their identity, their social network, their daily structure, their sense of contribution and relevance are all tightly woven into their professional role.
When that role disappears, the loss can be far more profound than the loss of income. Research from the Employee Benefit Research Institute found that while 67 per cent of workers felt confident about having enough money for retirement, only 48 per cent reported feeling emotionally prepared. That is a gap of nearly 20 percentage points between financial readiness and psychological readiness.
The American Psychological Association has reported that individuals who engage in psychological retirement planning report 42 per cent higher satisfaction levels post-retirement. Yet most pre-retirement programmes offered by employers focus almost exclusively on pensions, tax, and estate planning. The emotional, relational, and purpose-related dimensions are barely addressed.
This is the gap that coaching fills.
What coaching offers that financial planning cannot
A good financial adviser helps you plan your income. A good retirement coach helps you plan your identity, your purpose, and the structure of a life you actually want to live.
Coaching provides the reflective space and structured support that most professionals never get during the retirement transition. It helps them explore questions that no pension calculator can answer: What gives me energy? What do I want to be known for in this next stage? How do I use decades of experience in a way that still feels meaningful? How do I create a rhythm that sustains me without the external structure of work?
Frameworks like ikigai — which helps individuals identify the intersection between what they love, what they are good at, what the world needs, and how they can contribute — provide a practical, evidence-based foundation for this exploration. When used within a coaching context, ikigai moves from an abstract concept to a working tool for designing a purposeful next chapter.
The evidence supports this approach. Research consistently shows that purpose-driven activities, maintained social connections, and a sense of ongoing contribution are among the strongest predictors of positive retirement adjustment. Coaching addresses all three.
An opportunity, not a problem
None of this means retirement is inherently negative. On the contrary, for many people it represents an extraordinary opportunity — the chance to step back from the pressures of full-time work and design a life with more freedom, choice, and meaning than they have ever had.
But that opportunity does not arrive automatically. It has to be created. And for professionals who have spent decades defining themselves through their work, creating it requires more than a new hobby or a long-postponed holiday. It requires real reflection, honest self-examination, and the support of someone who understands the transition from the inside.
Financial advisers help you retire with enough money. Coaching helps you retire with enough meaning. In an ideal world, everyone approaching retirement would have access to both.
If you are approaching retirement, recently retired, or supporting someone through this transition, the question worth asking is not just “can I afford to retire?” but “who will I be when I do?”
Planning the answer to that question may be the most important retirement planning you ever do.
About the author
Vicky Russ is a leadership coach, former CEO, and specialist in helping professionals navigate redundancy, retirement, and major career transitions. She is the founder of VR Leadership Coaching and host of The Reframing Room podcast, which features real stories of reinvention from professionals who have turned difficult endings into meaningful new beginnings.
Vicky holds an MBA, is completing a Doctorate in Business Administration, and is a Fellow of the Chartered Management Institute. She is an accredited Life Coach, a certified grief and Ikigai coach, a Core Renewal Therapist, and a university lecturer in leadership. Her coaching draws on over two decades of senior leadership experience across the public, private, and charity sectors — and on her own lived experience of redundancy, reinvention, and rebuilding.
References
Fernández-Martínez, E. et al. (2020). Prevalence of Depression in Retirees: A Meta-Analysis. International Journal of Environmental Research and Public Health, 17(20), 7548. Azar, A. et al. (2018). Retirement and depressive symptoms: A 10-year cross-lagged analysis. Psychiatry Research, 269, 565–570. Mental Health Foundation (UK). Older People: Statistics. mentalhealth.org.uk Sone, T. et al. (2008). Sense of life worth living (Ikigai) and mortality in Japan: Ohsaki Study. Psychosomatic Medicine, 70(6), 709–715. Alimujiang, A. et al. (2019). Association Between Life Purpose and Mortality Among US Adults Older Than 50 Years. JAMA Network Open, 2(5), e194270. Kodate, N. (2025). What do we know about ikigai in research on ageing, health and wellbeing? Age and Ageing, 54(Supplement 4). Shiba, K. et al. (2022). Ikigai and subsequent health and wellbeing among Japanese older adults. The Lancet Regional Health – Western Pacific, 21, 100391. Employee Benefit Research Institute. Retirement Confidence Survey (various years). ebri.org American Psychological Association. Psychological retirement planning and adjustment outcomes. Kotera, Y. et al. (2021). Health Benefits of Ikigai: A Review of Literature. In Ikigai: Towards a Psychological Understanding of a Life Worth Living (Springer).