Australians no longer see reaching the retirement age as a hard limit on working, with a significant proportion of people planning on working past 65, new research has revealed.
A representative survey of 1500 Australians, compiled for the Association of Superannuation Funds of Australia (ASFA), has found peoples’ individual pathways to retirement vary greatly and there is no ‘one size fits all’ approach to retirement.
AFSA says the hard edge of working until retirement age and then stopping work completely is a thing of the past.
Many older Aussies intend to keep working
The survey showed a striking number of working Australians across all age groups who intend to maintain part-time or casual work in retirement in order to ‘keep occupied.’
While this intention was strongest amongst working Australians aged 18 to 34 (almost 40 per cent), 25 per cent of people still working at age 65+ said they valued work for the social connection and stimulation enough to want to maintain some form of work.
But many also said they would be working past retirement age for financial reasons, including a not-insignificant portion of older Aussies who believe they will never be in a financial position to retire.
People who were either employed or actively looking for work accounted for 33 per cent of survey respondents aged 65 to 69, and eight per cent of people aged 70 and above. Around 14 per cent of workers aged 65 and above don’t think that they will ever be able to retire for financial reasons.
As this survey covers older people still in work, extrapolating this number to the wider population equates to around three per cent of all people aged 65 and above believe theywill never be able to retire.
ASFA says the results show the pathway to retirement is not ‘one size fits all’ and that the hard edge of working until retirement age and then stopping work completely is a thing of the past.
Mary Delahunty, AFSA CEO says the change in retirement practicalities means rules around the superannuation accumulation and pension phases need to be changed.
“This research shows us the days of working to customary retirement age and then putting your feet up are long gone,” she says.
“The rules around superannuation need to change to reflect this. Currently, Australians who’ve hit preservation age can’t draw down on their super, and top up the same account.
“Being forced to have two or more accounts – one account to take money from and one to put money into – doesn’t make sense with our modern, fluid approaches to retirement.”
Advice needs be easier and cheaper
Ms Delahunty says the research shows Australians need access to high-quality, low- or no-cost financial advice as they transition to retirement.
“Having your options clearly laid out by a financial advisor from your super fund, as the Quality of Advice Review Final Report recommends, could only benefit the hundreds of thousands of Australians deciding how best to manage their finances at this important time,” she says.
“Our research shows beyond question that advice reform is vital to ensuring Australia’s super system remains a global leader.
“We’re committed to continuing to work closely with government and the sector to see these changes come to life without delay.”
At what age did you retire, or intend to retire? Did you receive any financial advice before doing so? Let us know in the comments section below.
Also read: How to discover your perfect retirement age
There’s a big difference between intending to continue working because they want to, and because they have to. I’m 72, and returned to work at age 69, after retiring at age 67, because financially it was a necessity. Only a few hours a week, but that keeps my bills paid, but I don’t know how long I can continue doing this.