Australian’s grapple with retirement options
Retirement is an inevitability for Australian workers, but as new research shows, it might not be quite as much of a simple process as you’d expect.
Mercer found that 42 per cent of workers believe they will retire at the age of 70 or older, but in reality the figure stands at just 3 per cent.
There are various reasons for this trend, but one of the most prominent is that employees don’t believe they’ll have enough retirement savings to adequately fund their lifestyle.
As many as 20 per cent of Australians between the ages of 50 and 80 believe they’ll head back to work at some point, perhaps as they outlive the retirement money they have set aside.
Garry Adams, leader of Mercer’s talent business in the Pacific market, said the retirement landscape is soon set to change, as some older workers may choose to return to work either full or part time.
Nevertheless, companies may experience a number of difficulties in doing this and could face what Mr Adams refers to as a “double-edged sword”.
“It can boost economic output and allows companies to preserve years of acquired knowledge and valuable experience,” he explained.
Mr Adams emphasised that there are potential downfalls as well. “Highly compensated senior workers who stay can put a drain on financial resources and block younger employees from possible promotion opportunities,” he added.
This is where businesses could reap the benefits of investing in HR consulting, which enables them to weigh up their options and determine what the best course of action will be.
Last month, the Association of Superannuation Funds of Australia found that many people don’t fully understand the role of insurance within their retirement savings.
Data revealed just over 40 per cent of people have a poor understanding of insurance within their super, with the lowest level of comprehension generally among those under the age of 32.