23 August 2024
New Study Reveals more than 80% of retirees and pre-retirees believe the Age Pension is insufficient and more than 75% are open to working post-retirement
- 82% believe the Age Pension is insufficient to fully support their retirement.
- 38% of respondents plan to explore part time work or other employment opportunities post-retirement, with a further 39% open to the idea.
- 26% expect to live beyond 92, underscoring the need for extended financial planning.
- 28% of participants have not yet developed a retirement plan tailored to a specific life expectancy.
Sydney, Australia (23 August 2024): A recent study of nearly 850 highly engaged retirees and pre-retirees has found that 38% of respondents plan to explore part-time work or other employment opportunities post-retirement, with a further 39% open to the idea.
Furthermore, 82% believe the Age Pension is insufficient to fully support their retirement.
The research – How do we make retirements more epic? – conducted by Allianz Retire+ in partnership with bestselling author, podcaster, and retirement educator Bec Wilson, underscores Australia’s shifting attitudes towards traditional retirement.
Those aged 55 to 65, referred to as Gen X ‘flexers’, no longer see retirement as a hard finish line and instead are embracing an extended phase of life, marked by newfound freedoms and opportunities. Many retirees are integrating part-time work, hobbies, travel, and passion projects into their post-work lives.
Commenting on the study, Allianz Australia Life Insurance CEO Adrian Stewart said, “this desire to continue some form of work signals a massive step change for retirement. It is no longer a line in the sand in an individual’s working-life.
“Retirement needs to be completely reconsidered from all aspects, including how we plan financially,” explained Stewart.
“It’s not news that Australians are living longer, healthier lives and that today’s retirees typically enjoy a more active lifestyle than previous generations.
“These gains in quality and quantity of life come with an implied financial cost, one that requires retirees to stretch their savings over multi-decade timeframes that will include unpredictable market conditions, such as those experienced recently, and personal challenges.”
The study found only 24% of retirees surveyed feel confident they’ll have enough funds for a comfortable retirement.
The term ‘FORO’—Fear of Running Out—has recently gained traction in retirement discussions. ‘FORO’ encompasses concerns about inflation eroding savings, market volatility, and the risk of outliving one’s savings and being reliant on the Age Pension.
“Australians are looking to embrace a second act that could span 25 years or more, but many don’t feel financially prepared to navigate the transition,” said Bec Wilson.
“Our research indicates a strong desire for education and advice to help achieve retirement goals and alleviate concerns about running out of money.”
The study found significant demand for retirement income solutions that provide guaranteed lifetime income, income certainty, easy access to funds, investment growth, and protection against market volatility. Over 75% of respondents said they would consider “new era” lifetime income streams as a source of retirement income.
While 49% of respondents had heard of lifetime income streams, they lacked detailed knowledge about them, and 28% of participants have not yet developed a retirement plan tailored to a specific life expectancy. Despite this, 71% emphasised the importance of ensuring a lifelong income. These findings highlight the growing consumer desire for increased financial confidence in retirement.
This trend is also reflected in interest in and uptake of Allianz Retire+’s Allianz Guaranteed Income for Life (AGILE) product, which is seeing significant month-on-month increases.
“Empowering clients to be ready for retirement can make a difference to their physical and mental wellbeing.
"After long working careers, retirees deserve the freedom to truly enjoy their well-earned leisure, and financial security is key to that," said Stewart.
The study also reflects the impact of the federal government’s Retirement Income Covenant, introduced in July 2022, which has brought retirement income streams into sharper focus.
“This legislative shift has driven advancements in retirement income products and highlighted the need for increased consumer education to navigate the evolving landscape”, said Stewart.
Allianz Retire+’s lifetime income solution AGILE, is providing much needed innovation, offering a guaranteed lifetime income product that incorporates a combination of features previously unavailable in Australia. These include:
- A guaranteed income stream, for life
- Access to capital
- Protection against market volatility while still offering capital growth potential
- Protected exposure to market movements.
The full report, which is categorised into key topics including longevity planning, financial confidence, retirement planning needs, and understanding of retirement income products and concepts also includes tips and suggestions to help advisers speak confidently with their clients about retirement planning.
-ENDS-
Media contact:
Kate Hallman P: 0413 946 704 E: kate.hallman@secnewgate.com.au |
Lucy Drew P: 0411 245 690 E: lucy.drew@gmail.com.au |
About Allianz Retire
Allianz Retire+ delivers the next generation of retirement income solutions to the Australian market. Our financial product solutions are designed to simplify the complex financial and emotional challenges that can confront people who are heading into retirement. Allianz Retire+ is a world-first Australian venture combining the scale and expertise of international insurance provider Allianz and global investment expert PIMCO.
Disclaimer
This material is issued by Allianz Australia Life Insurance Limited, ABN 27 076 033 782, AFSL 296559. Allianz Retire+ is a registered business name of Allianz Australia Life Insurance Limited. This material has been prepared by Allianz Retire+ for general information purposes only. It is not comprehensive or intended to give financial product advice. Any general advice provided in this material does not take into account your objectives, financial situation or needs. Before acting on anything contained in this material, you should speak to your financial adviser and consider the appropriateness of the information received, having regard to your objectives, financial situation or needs. No person should rely on the content of this material or act on the basis of anything stated herein. Allianz Retire+ and its related entities, agents or employees do not accept any liability for any loss arising whether directly or indirectly from any use of this material. Use of the word ‘guarantee’ in this material refers to an assurance that certain conditions or contractual promises will be fulfilled by Allianz Retire+ from the available assets of its Statutory Fund No 2, in relation to the product terms. This includes ‘guaranteed’ income payments in the Lifetime Income Phase which will be paid from the available assets of Statutory Fund No 2, noting that Allianz Retire+ may terminate the product in certain limited circumstances as outlined in the Product Disclosure Statement referred below. Allianz Australia Life Insurance Limited is the issuer of Allianz Guaranteed Income for Life (AGILE). Prior to making an investment decision, investors should consider the relevant Product Disclosure Statement (PDS) and Target Market Determination (TMD) which are available on our website (www.allianzretireplus.com.au). PIMCO provides investment management and other support services to Allianz Retire+ but is not responsible for the performance of any Allianz Retire+ product, or any other product or service promoted or supplied by Allianz. Use of the POWERED BY PIMCO trademark, or any other use of the PIMCO name, is not a recommendation of any particular security, strategy or investment product.