Suite 8 / 260 Auburn Road, Hawthorn 3122
Phone: 03 9214 4100
Fax: 03 9818 6008
enquiries@trumpetfinancial.com.au
 
 
eWombat Search
  LATEST FINANCIAL NEWS
 
Hot Issues
Financial advice is the leading trigger to review insurance inside Super
Opinion – 2018 to be the year of the machine
Rising risks to the status quo
UPDATE: Australia's vital statistics
As share prices rise, the risk-return trade-off gets tricky
Technical expert flags top 3 traps with CGT relief
Become a better investor through your holiday reading
Australia's vital statistics
Made in Albania? How globalisation is creating challenges for Chinese policymakers
Our Advent calendar for 2017
For the young it a question of engagement
Address Under-insurance at Personal Finance Level - Global study
Realism vs reality - working part-time as retirees
SMSFs warned on ‘ticking time bomb’ with outdated deeds
Statutory wills are underutilised in estate planning
Resources on our site to help you, your family and your friends.
Calls to Review ASIC's Definition of Lapse Insurance
Paperwork bungles lead to $38k in payments
Self-employed? Don't miss out on super
Australian Dietary Guidelines and healthy eating chart (PDF)
Big concessions looking likely for transfer balance limit: ATO
Raft of superannuation measures enter Parliament
US Fed policy: Normalisation begins
What the gig economy may mean for your super
Powerful Budgeting, cash flow and Super Tools available on our site.
Australia's leading causes of death - ABS
Articles archive
Quarter 4 October - December 2017
Quarter 3 July - September 2017
Quarter 2 April - June 2017
Quarter 1 January - March 2017
Quarter 4 October - December 2016
Quarter 3 July - September 2016
Quarter 2 April - June 2016
Quarter 1 January - March 2016
Quarter 4 October - December 2015
Quarter 3 July - September 2015
Quarter 2 April - June 2015
Quarter 1 January - March 2015
Quarter 4 October - December 2014
Realism vs reality - working part-time as retirees

Are you planning to boost your retirement income by doing some part-time work once you eventually retire? Perhaps you have included the expectation of some paid work in your calculations about how much you need to finance your retirement.



       


 


If so, this leads to another question: How realistic is that expectation?


A Vanguard research paper, Retirement transitions in four countries, may help provide some answers.


More than 5560 pre-retirees (who are planning to retire within 10 years) and recent retirees (who retired over the past 10 years) age 55-75 took part in the study covering Australia, the United States, United Kingdom and Canada. This includes 743 Australian pre-retirees and 703 Australian recent retirees.


In short, the researchers wanted to compare the expectations of pre-retirees with the experiences of recent retirees – including in regard to doing some work as a retiree.


Researchers found that pre-retirees were up to four times likely to say they expect to work in retirement compared to the proportion of recent retirees actually working. Consider the findings:


  • Australia: Pre-retirees expecting to do paid work at least once a week in retirement (42 per cent). Recent retirees actually working at least once a week (11 per cent).
  • United States: Pre-retirees expecting to do paid work at least once a week in retirement (42 per cent). Recent retirees actually working at least once a week (14 per cent).
  • United Kingdom: Pre-retirees expecting to do paid work at least once a week in retirement (40 per cent). Recent retirees actually working at least once a week (10 per cent).
  • Canada: Pre-retirees expecting to do paid work at least once a week in retirement (47 per cent). Recent retirees actually working at least once a week (14 per cent).

These findings raise another question: Why is there this gap between expectations to work in retirement and actually working?


"There are several possible reasons for this difference," the researchers write. "Pre-retirees may feel they need more sources in retirement, and so expect to work.


"It could also be true," they add, "that recent retirees had the same idea [as pre-retirees], but then, upon retiring, realised that the work was no longer necessary in retirement. Pre-retirees may also be overestimating their ability to find suitable work."


Whether retirees do some work much depends on such factors as employment opportunities, health and family obligations – and whether they actually want to do paid work after getting a taste for retirement.


A message is that you should be particularly cautious about counting on part-time work as a retiree to boost your retirement income.


 


Written by Robin Bowerman, Head of Market Strategy and Communications at Vanguard.
13 November 2017
vanguard.com.au




10th-December-2017
Trumpet Financial Pty Ltd ABN 11 443 516 384 Corporate Authorised Representative (No 327756) of Aon Hewitt Financial Advice Limited AFSL 239183 ABN 13 091 225 642
Registered Address: Level 33  201 Kent Street, Sydney NSW 2000 | Sitemap | Disclaimer | Privacy Policy | About Aon Hewitt Positioning