Golden goal

Employees are getting older and living longer, making retirement strategies more important than ever. 

An ageing workforce, changes to the age pension and longer retirement mean older workers need to plan ahead, experts say.

Such news affects an increasingly larger portion of the nursing workforce. In 2011, the latest ABS data shows, the number of nurses aged over 55 rose by 10 per cent from 2001 to 2011, whilst nurses aged 50–54 made up the largest age group in the sector.

At a recent public lecture, Keri Spooner, human resources expert at UTS, said current discussions on the working lives of older Australians are not examining all factors at play.

She says government policy needs to look at the type of work people over 65 are doing, as well as their particular needs and wants.

Developing policy on older Australians and the workforce in isolation from a broader consideration of demographic issues throughout the whole society, she says, is dangerous.

“We are now focusing on 70 years of age – [we] want people working until 70,” Spooner says. “However, I want to draw people’s attention to the fact [that this] is not a simple matter and there is no simple answer.”

She says it’s important to take into consideration the forces that are now shaping the choices of older Australians, which include financial concerns, health, caring responsibilities, past work experiences and personal aspirations.

Australian companies will need to change to adapt to the older workforce.

“Most companies know they have to change, but not all,” Spooner says. “A lot of the job redesign that needs to happen to accommodate older workers will benefit all workers.”

LONG-TERM STRATEGY NECESSARY

Will redesigned jobs and policy be enough?

Professor Susan Thorp, chair of finance and superannuation at the University of Technology, Sydney, poses the following question: “Can we count on having enough super, savings and pension to eat, drink and be merry in retirement?”

And the answer is, not without careful planning. “For most of us, managing our wealth in retirement will be the hardest financial problem we ever have to solve, Thorp says. “We will need to figure out how to turn a lump sum of savings into a lifetime income.”

She puts forward the following suggestions, most of which she says are “non-financial common sense” to make sure you are fully prepared when planning for retirement.

“First, we need to set aside the fear and loathing and take a look at where we are – super balances, bank balances, earnings, spending plans, super contributions and debt,” she says. “The ASIC MoneySmart website is a good place to start. It’s not too scary. If you just do that, you will be ahead of about half the adults in Australia. Look after your health and look after your relationships.”

Owning a house somewhere you would eventually like to live is another step in the right direction, Thorp says, as the system is geared to favour those who do this.

Also, “Find out when you will be able to access your super and the age pension. The rules are changing for many people, and we all need to be informed,” she explains. “Beware retiring and taking your super ahead of the Age Pension, funding that gap can be expensive. Long retirements seem attractive, but recent research indicates that they can be bad for your health.

“By far the best financial strategy for middle-aged employees is to work longer if possible. An extra five years of work makes up most of the gap towards a comfortable lifestyle for a couple on average earnings and reduces the gap by about half for a single person.”

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