Pressure on Govt is relieved by delayed retirement
A new survey from Roy Morgan revealed that Australians intended to delay their retirement, with the average age of those intending to retire in the next 12 months at 61.9 years, up from 58.2 years in 2014, which could benefit governments.
Industry communications director at Roy Morgan, Norman Morris, said an increased intended retirement age would benefit both the individual and the Government.
The individual is afforded a longer period to save for their retirement, and the Government would benefit from a reduced period in funding through pensions, while superannuation funds would accumulate for longer.
“Currently, the Australian Government faces twin financial pressures on funding the age pension, from an increase in life expectancy and inadequate personal retirement savings,” said Morris.
“Given this situation, it is a positive finding in this research that there has been a gradual increase in the age of intending retirees,” he said. “This results potentially in a longer period of paying tax, increased savings and as a result less time on the pension, possibly at a reduced level.”
Morris noted, however, that one drawback of a delayed retirement is that it could increase unemployment, with older workers occupying positions that younger people could have otherwise filled.
The results also showed the average age of female retirees is increasing faster than males, with females intending to retire at 61.3 years of age now as opposed to 55.5 years in 2008, partly due to increased awareness that women will retire with a lower super balance than men.
“This has now reached the stage where the intended age of retirement is almost identical for both sexes, enabling greater savings potential for females heading into retirement,” said Morris.
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