The time has come to reconsider how everyone thinks about retirement as the distinction between giving up work and moving towards a more relaxed lifestyle blurs.
A study by HSBC Bank believes that now people can expect to live longer, many want to continue working, but at less of a pace than earlier in their careers.
The latest research collected by the bank reveals many can expect to live well beyond the expected lifespan of 70 years or so.
Since 1950, longevity expectations have increased by 13 years in Germany, 21 years in Japan and 30 years in China, says HSBC Global Research.
This change in life means thinking again about retirement because a longer life means needing more income to provide a comfortable lifestyle after giving up work.
Other factors also come into play, such as governments having to look at funding health services and long-term care for a rapidly aging population.
Aging population
Research by the United Nations expects to the global population aged over 60 to soar from 841 million in 2013 to more than 2 billion in 2050.
Meanwhile, plunging birth rates mean fewer workers will contribute taxes to support them.
The forecast is four workers will have to support each person aged 65 or over in 2050, compared to eight in 1950.
“Many workers who would normally have retired by 65 years old are choosing to work on often in some sort of reduced capacity to earn an income to supplement their pensions and because they are fitter and more able to hold down a job,” says the bank.
“Now, we are looking at phased retirement rather than a complete stop on the 65th birthday.”
The report – The Future of Retirement Choices for later life – argues that 22% of retirees moved into semi-retirement before giving up work, and 56% of workers plan to phase in retirement.
Realistic expectations
Researchers spoke to 16,000 people in 15 countries and discovered semi-retirement was popular in Asia – especially Indonesia (77%), Malaysia (64%)and Singapore(62%)planning to cut their hours rather than stop work at retirement age.
“This is not necessarily bad,” says the report. “Older workers will help economic growth as they have the skills and experience many employers are seeking. The older work force will shrink, but not disappear as before.”
However, the bank warns that individuals need to take a lifetime view of their finances and start saving more and earlier in their careers.
Many will also have a more realistic expectation of when they can retire and what they can afford to spend.
There are several good guest posts on the site Retirement And Good Living on phased retirement, transitioning to retirement and the stages of retirement. The site provides information on many retirement topics including retirement planning, finances, health, retirement locations and more. And it has many guest posts in its blog from expats who retired to various locations including Central and South America, Asia, Europe and the Caribbean.