The trends and forecasts are clear – Australians will continue to live longer. We now have one of the highest life expectancies in countries among the OECD, and it’s expected to increase well into the nineties over the next 40 years. On the surface, longer life expectancy is welcome news. It means we’ll have more time to pursue the things we’re passionate about, whether it’s spending more time with family, travelling the world or contributing to a cause. The catch is that longer retirements cost more, and at present, the reality is that the majority of Australians won’t have enough savings to live comfortably in retirement. So it’s likely we will have to work longer to save more for a longer retirement. At the very least, some of us may need to stay in the workforce until we qualify for the Age Pension, which is proposed to rise to 70 years by 2035. The thought of staying in the workforce longer won’t be welcome news for many people. It raises some confronting questions, in particular, whether Australians will be healthy enough to keep working until they’re 70. This report answers this question and the key insight is that as a nation we must think carefully about our approach to the later years of working life. Reaching a certain age shouldn’t mean we need to leave the workforce entirely. Rather, retirement should be a transition phase with reduced levels of work that gives us more time to focus on our health and wellbeing. Funding ourselves through these transitions is important, but so too is our health and the ability to continue to actively contribute through work or volunteering. There is an important role employers can play to help re-design the workplace of the future so that older workers can stay at work for longer and transition to retirement in a way that suits them, while building wealth and income along the way. Not only does this provide more options for older Australians to save more for retirement, but also helps the nation harness the skills and knowledge that would otherwise leave the workforce. Doing this is good for Australians, and good for Australia. So while there is work to do in making the workforce more adaptable for a transition to retirement, it also raises the question for each of us – how healthy will we be in the later years of our working life?
|Place of Publication||Australia |
|Commissioning body||AMP - Wealth Management Company |
|Number of pages||32|
|Publication status||Published - 2015|
|Name||AMP.NATSEM Income and Wealth Report |