Australian workers delay planned retirement amid concerns about savings

22 December 2008

Almost one third of Australian workers say they don’t expect to retire from work until after the age of 65 while less than half believe they will have sufficient savings to retire comfortably, according to an international survey of retirement intentions.

The survey, by global recruitment firm Kelly Services, found that 29% of people in Australia believe they will need to rely on the pension or social security after they retire.

The global survey sought the views of 115,000 people in 33 countries including almost 19,000 in Australia.

Kelly Services Managing Director, James Bowmer said the survey shows that many people are planning to work for longer as part of a broader movement away from the traditional idea of absolute retirement from the workforce.

“Increasingly, we see that people will continue in some form of employment, either working part time, doing consultancy work or starting up a business.

“The idea that one day you are a full time employee and the next you are a full time retiree is becoming a thing of the past.

“The survey shows that even before the global financial crisis, which has eroded retirement savings, many workers were planning to remain in the workforce for longer in order to maintain their quality of life and maximise savings”.

Amongst the key findings of the survey:

• 69% of respondents realistically expect to retire by age 65 while 31% plan to work beyond 65
• Only 41% believe they will have enough savings to retire comfortably
• 29% say they will need to rely on a pension or social security after they retire
• 74% say they would accept an offer to continue working at the time of retirement
• 41% say they think they could easily find a job after retirement

In Australia, there are more men that plan to work beyond age 65 than women.

The survey was undertaken in early 2008 and canvassed the retirement plans of workers across Australia.

When asked how they would supplement their income after retirement, 24% said they would seek permanent part time work, 16% would look for temporary or contract work, 19% planned to start a business and 33% were unsure.

Interestingly, of those who would accept the offer of continuing work with their employer after retirement, many would not be doing it solely for the money. A total of 56% said their motivation would be to keep active, 24% would do it out of a sense of loyalty and 18% for the income.

The question of where people would choose to live after retirement produced mixed feelings.   A total of 44% plan to stay in the same town/city; 10% would live in a different town/city; 4% would shift to a different country and 42% were undecided.

Mr Bowmer said, “Even with the likelihood of unemployment increasing, there is still a valuable role for older workers in this environment.

“Many workers will continue to work after retirement age and will plan their retirement as a transition from the workforce, rather than an abrupt departure.

“For some, it will be necessary to continue some form of work to maintain their quality of life.  Others will find that staying engaged in the workforce helps to keep them healthy and active,” Mr Bowmer said.