Are you considering your retirement? Do you have a plan in place? When do you plan to retire? Are you financially prepared for your retirement - your next adventure?
© Danielle Robertson Consulting Pty Ltd t/as DR Care Solutions
It is interesting to understand the age at which Australians are retiring, the motivations behind their decision to hang up the hat, and whether their retirement age “went to plan”.
According to latest Australian Bureau of Statistics data, collated in FY2019:
55% of Australians over 55 years of age are retired.
The average retirement age (of all retirees) is 55.4 years.
The average age people intend to retire is 65.5 years.
Financial security is the main factor influencing the decision to retire.
For most retirees, the Commonwealth Government Aged Pension is the main source of retirement funding.
These are pre-pandemic statistics.
Anecdotally, those over 50 year-olds with stable jobs during the pandemic are holding firm to their retirement plans. The pandemic prompted some to bring their plans forward to enjoy life while they are fit and healthy.
For those over 50s made redundant or on reduced hours, their retirement plans were derailed by the pandemic. Anecdotally, this cohort is bunkering down, holding off dipping into their retirement savings for as long as possible, and looking for work. We need these people to obtain work and continue to contribute physically and fiscally.
A similar trend occurred during the Global Financial Crisis of 2007/2008 where a significant number of people delayed their retirement while a small proportion retired.
The past two decades have revealed one truth - we need to plan for the unexpected.
This takes me to an important finding from the ABS data - that people retire sooner than they expect. People intend to retire at 65.5 years of age but find themselves retiring 10 years earlier.
In particular, the data reveals the vulnerable financial position of women who, on average: have lower superannuation savings; find themselves unexpectedly retiring earlier to take on the position of unpaid carer; and live longer.
So what retirement funds can be accessed at the age of 55? Well, you could be facing a funding flow gap. The eligible age for the Commonwealth Government Pension is gradually rising from 65 years to 67 years and the ability to withdraw from superannuation depends on whether you have reached your “preservation age” (of between 55 to 60 years of age).
Knowing all this, it comes as no surprise that the levels of Commonwealth JobSeeker payments (unemployment benefits) are highest in the 60 and over years age category and that the number of women over the age of 50 receiving payments has skyrocketed.
As a professional advising older Australians on care, the question of retirement savings and the ability to fund care is a constant. My strong advice is not to ignore the topic. Find a recommended and licensed financial planner, and make plans for your retirement.
While financial security contributes to wellbeing, research constantly reminds us that health and social connectedness is central to a fulfilling and meaningful retirement.
So, it’s not all about the money though, maintaining health through exercise and social connectedness through activities, does require some funds.
Speaking for my own sector, there is a dire shortage of aged care workers. Why not consider completing a Certificate in Aged Care at TAFE to support an industry in need of caring, empathetic, skilled and healthy workers?
Please note that information in this blog is information only, and must not be relied on as financial advice.
If you are seeking a licensed financial planner with skills in aged care funding, please feel free to call me, Danielle Robertson, for a recommendation. We work closely with a number of respected licensed financial advisers in setting up the right care, support and assistance at the right time and in the right place for their clients.
 Australian Bureau of Statistics: Retirement and Retirement Intentions, Australia
 Services Australia: Aged Pension - Who Can Get It
 Australian Taxation Office: When You Can Access Your Super
 Parliamentary Budget Office: JobSeeker Payment
 Moneysmart.gov.au: Choosing a Financial Adviser That Suits You and Your Goals
 TAFE: Aged Care Courses