However, according to a report by news.com.au
, the situation will be worse for single women, who Knox said will have a heavier financial burden after they stop working.
“About two-thirds of people when they retire are in a couple’s situation,” Knox said. “But for single women, and for those who have had children, it’s a big concern because they don’t have a partner’s support and there is no easy fix or silver bullet.”
He suggested that women’s superannuation rates should be made compulsorily higher than men’s in order to lessen the issue.
The report claimed that the gap is partially blamed on women’s inclination to take time away from work to have children, as well as there being a much higher percentage of women in part-time roles than men.
Research conducted by the Australian Institute of Superannuation Trustees and Mercer reportedly found that the over 65 workforce needs to double in size to ensure that the national superannuation system improves.
Knox added that women should receive compulsory superannuation repayments whilst they are on paid parental leave.
The Superannuation Funds of Australia’s retirement standard says that in order for a couple to achieve a comfortable retirement they need to spend $58,364 a year. Those seeking a “modest” retirement need to spend $33,766 a year.
Knox said that those who retire in their 60s can expect a retirement period of around 25 years – but people need to be willing to push back their retirement.
“It’s not that we all have to work full time until 75 but I think it could be a case of phasing down to two or three days per week,’’ he said. “For some people it could be taking on a different sort of job that requires less pressure.’’
The retirement age in Australia is due to rise to 70 in 2035.
Implementing a retention program for older workers
Teachers Mutual Bank (TMB) is one of the top five largest mutual financial institutions in Australia, and a large proportion of its workforce is aged over 50.
A third of the TMB workforce is over the age of 50, and 13% are aged over 45.
CHRO Helen O’Reilly spoke to HRD
magazine about retaining older workers.
“I found that this group alone had an average length of service of 11 years and over 1,500 years of corporate knowledge,” O’Reilly said. “If they were to all walk out the door within two years, it would be a tremendous loss to the organisation.”
TMB partnered with SageCo to implement their Envisage program into their workplace.
“Instead of just talking about retirement from a financial angle, it looks at the six different areas: money, identity, health, career, relationships, and the future,” O’Reilly explained. “We complemented that program by offering nutrition seminars called Keeping Nifty Over 50. We also partnered with one of the super funds and they ran wealth creation workshops.”
When the program was introduced, many of TMB’s recently recruited mature age workers spoke out about the discrimination they had faced as job seekers.
“I was astounded at how many stories there were out there, and they were so grateful that we valued their experience,” O’Reilly added. “They also appreciated that we were still willing to invest in them. Instead of saying ‘you’re 60 so we’ll give you a job but we’re not going to invest any money because there’s a good chance you’ll only be here a couple of years’, we made investment in their skills a priority.”
Envisage gave employees the go-ahead for older workers to discuss what their career and transition to retirement needs were with managers.
“It was interesting that everyone had different needs: some people were looking to reduce their hours of work and to spend time testing the waters in what they would do in retirement; others had no plan to retire any time soon,” said O’Reilly. “I believe it was very positive to be able to offer that flexibility and to encourage them to feel comfortable to start a conversation.”
Mercer senior partner David Knox has said that Australians will soon need to work well into their 70s in order to support themselves financially post-retirement.