retirement age in australia

More older Australians are staying in work for longer, creating a new ‘peak’ retirement age, according to a new KPMG report.

Analysis by KPMG Urban Economist, Terry Rawnsley, suggests that Australian workers are retiring at their oldest age since the 1970s. This higher expected retirement age has remained unchanged over the past two years, which suggests a major shift since the Covid pandemic.

  • The expected retirement age for men is now 66.2 (highest since 1972).
  • The expected retirement age for women is now 64.8 (highest since 1971).

Drivers for these changes are increased flexibility in what Rawnsley calls ‘knowledge intensive’ roles, also the increase in working from home which has allowed many older Australians to ‘semi-retire’ or work from home or a holiday location.

Whilst it seems that older workers ‘filled gaps’ during the Covid years, the labour market has since tightened with the return of international migration and growth in the under-55 labour force.

More women are also working full-time with the expected age of retirement from full-time work increasing by 12 months. Somewhat conversely, the later age of retirement for men is seen to have been encouraged by increases in part-time retirement. Rawnsley noted, however, that:

“Even in a tight labour market, we may have reached a plateau in the expected age of retirement, suggesting we cannot expect older workers to continue working longer. This is because we simply can’t find enough older workers to sustain the growth that occurred during the COVID-19 era.” 

Benefits of a longer working life

Working longer has more benefits than just the financial ones. There is the sense of contribution, purpose and connection. There are also the health benefits from the social interaction – and the case to be made for keeping your brain active.

The Federal Government has put policies in place to encourage retirees to work longer and to work extra hours. The main change was a $4000 increase to the Work Bonus Credit, which was previously $7800 per annum. This change became permanent on 1 January 2024. We explained these rules in some detail a few weeks ago, so here’s how this bonus works for those who choose to work more.

What does working longer mean for you?

Work is a highly individual matter. Some people love their work and never wish to stop. Others can reach a stage where stepping back, rather than out of the work force is their preferred option. Still others may wish to give up work completely.

And then there are the nearly 40% of retirees whose ability to work has been cut short by ill health or redundancy.

Regardless of your motivation, or need, making the transition to retirement requires a deft mix of emotional, practical and financial decision-making.

Retirement Essentials offers many consultations that can help you to plan, organise and execute your own pathway to retirement. Whether you need assistance to:

Retirement Essentials can offer a relevant, tailored consultation, facilitated by an adviser who will assist you to make your own best decisions.

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