Most people today do not dare to dream of the two words "retirement," and even in the U.S., many people admit that they have no retirement savings. Rising prices force the younger generation to face a bleak future; they need to save over 1 million dollars to retire comfortably. Meanwhile, a small segment of the world's billionaires owns enough wealth to live comfortably for many generations without lifting a finger. However, they still work tirelessly despite the negative impacts on their health, family, and even their wealth. So what makes billionaires unable to stop working?
Financial Factors
According to Bloomberg, the average age of global billionaires is currently 63 years and is trending upwards due to increasing human longevity. Specifically, the average male billionaire is 63.7 years old, while the average female billionaire is 62.4 years old. Although women live longer, female billionaires tend to be younger because many inherit wealth or receive large divorce settlements at a young age. Most billionaires under 30 have inherited vast fortunes. As age and wealth are proportional, the number of billionaires who continue to work into their later years is increasing; many believe they are obsessed with accumulating wealth, that the mindset of the super-rich is never enough. However, reality shows that some billionaires could be even richer if they took a step back and enjoyed life.
One report suggests that Donald Trump could own a fortune of up to 13 billion dollars if he had received an inheritance of 400 million dollars in 1988 and passively invested in the S&P 500; this amount could be double his current net worth. Another case is Bernard Arnault, who frequently appears on the list of the world's richest billionaires and is still serving as Chairman and CEO of the luxury goods group LVMH at the age of 75. He has surpassed the retirement age by the standards of most people and is just five years away from the average life expectancy of a French person. Even though his children hold leadership positions in the company, Bernard Arnault has no intention of retiring, a decision that worries many investors because the elderly chairman has clearly stated that he does not want to resign despite the troubles it may cause for the company.
So what ultimately makes billionaires reluctant to retire?
One of the main reasons is their close attachment to work. Like many ordinary people, research by Professors Steve and Josu from Stanford University has shown that 69% of billionaires on the Forbes 400 list are self-made. They have dedicated their time and effort to building their business empires from scratch, and this passion has kept them tied to their work. However, not all billionaires are startup entrepreneurs; the remaining 31% on Forbes' list of the richest people in the world have amassed their fortunes through inheritance, lucky investments, or hefty salaries as senior executives.
A typical example is Steve Ballmer, who did not found the company himself but became a billionaire by holding the position of CEO of Microsoft after Bill Gates stepped down. From 2000 to 2014, Ballmer received billions of dollars in Microsoft stock, and his role in the company is considered extremely important. Although Microsoft's performance under Ballmer was only average, his current net worth is nearly equal to that of Bill Gates. The reason Steve Ballmer received such a huge salary while he was CEO of Microsoft is that at that time, he was the only person in the world capable of replacing Bill Gates to lead the company.
Finding a suitable successor, especially for senior leadership positions, requires a lot of time and effort. This shows that the success of some companies heavily depends on the efforts of a few key individuals, often the founders who are also billionaires. When you build a successful business to the point where your equity is worth billions of dollars, retirement becomes much more complicated; you cannot simply leave the company without a clear plan for that massive equity.
There are several ways for billionaires to detach from their companies, including selling shares, listing the company on the stock exchange, or building a self-sustaining business that generates stable cash flow so they can live off dividends. They can also use equity as collateral for personal loans to support their lives after retirement. Among these, selling shares is the simplest and most common option. The scale of private equity funds specializing in buying businesses from founders has surged by 800% over the past 20 years. Additionally, billionaires can also sell shares through initial public offerings (IPOs).
However, selling shares in any form must comply with many strict regulations, especially regarding the pace of sales; investors often do not want founders to leave the company immediately after selling shares. Therefore, many private equity transactions often come with time-bound clauses requiring founders to continue working for the company after selling shares. According to the corporate law firm Reed Smith, the average time a founder needs to stay with the company after selling has significantly increased in recent years, typically lasting from 1 to 3 years. This means that even if they decide to sell shares, billionaires still cannot rest immediately.
On the other hand, if billionaires choose to build a self-sustaining business that generates enough cash flow to cover their living expenses through dividends, this is also a long process and may require sacrificing some future growth opportunities. When a company pays dividends to shareholders, it means they will not have many resources to reinvest in research and development or pursue acquisitions, especially for billionaires who are the sole shareholders. This is a difficult trade-off, especially if the company has many other investors; they will always pressure management to focus on business growth rather than sharing profits.
Another option is to use the company itself as collateral to borrow funds, a method many billionaires adopt. A typical example is Elon Musk, who used his Tesla shares to secure loans to acquire Twitter and inject more capital into SpaceX. However, this option also has the downside that billionaires still have to be responsible for repaying the debt. Therefore, they still need to continue working to ensure a stable cash flow.