Why more Australians are easing into retirement, not exiting completely
For many Australians, retirement no longer means shutting the laptop, handing over the keys, and heading straight to the golf course. More and more people are choosing to scale back, not step out, as they ease into this next life stage. It’s a shift that’s becoming known as ‘flextirement’: a flexible transition into retirement rather than a hard stop.
Flextirement is already happening, just not always by design
According to recent statistics, more than 70% of Australians aged 50 to 64 have no intention of retiring completely.1 Even among those aged 65 and over who are still working, many are doing so for reasons beyond just money: around one in four say they work for social connection, routine, mental stimulation or purpose.2
Participation rates among older workers have also risen steadily over the past two decades. In 2000, just over half of Australians aged 55 to 64 were in the workforce. Today, it’s more than 70%, with participation among people aged 65 and over almost doubling in that time.3Ìý
This could be the cost of living pressures, longer life expectancy (which isn’t a bad thing!) or growing financial support for adult children trying to enter the housing market. But whether for financial reasons, to keep the brain firing or a bit of both, there’s no doubt that more and more Australians are remaining in the workforce longer than ever before.
The role of identity in retirement planning
Stopping work isn’t just about financial preparedness. For many long-serving professionals, their role is a big part of who they are. It brings structure, responsibility and a sense of community. Letting go of that all at once can be unsettling, even if retirement itself is something they’ve looked forward to.Ìý
That’s where a gradual step-down can be appealing. Some people move to part-time hours. Others shift into mentoring, training or occasional project work. Staying connected to the workplace, even in a reduced capacity, can make the transition easier to manage emotionally, socially and practically.
Workplace reforms
Flexible work arrangements for older Australians haven’t always kept pace. Some organisations still lack formal policies or pathways for experienced staff to reduce their hours, adjust responsibilities or move into mentoring roles. This can leave people feeling like they either have to keep working full-time or leave altogether, even if they’d prefer something in between.
While useful for a lot of industries, in sectors like healthcare, education and emergency services, where knowledge and relationships are built over time, the lack of flexible work options can be a lost opportunity for both the organisation and the individual. Many of these roles are facing workforce shortages. Retaining skilled staff for a few more years in a different capacity makes good business sense and supports smoother knowledge transfer.
Planning for flexibility in life and income
If you’re starting to think about retirement, it’s worth having early conversations about your options. Some employers offer transition-to-retirement programs or flexible pathways. Others may be open to more informal arrangements if you take the lead.
These conversations don’t need to be overly formal. You might start by talking to your manager about how your role could evolve over the next few years. Some begin by reducing hours gradually, transitioning to project-based work or mentoring, or stepping away from physically demanding duties. The key is to be clear about your goals, open about your needs and stay ready to explore what’s possible together.
It’s also worth exploring how your defined benefit may be impacted by changing your work arrangements and what’s possible from a financial planning perspective.Ìý
If you’re unsure where to start, 91ºÚÁÏ’s My Retirement PlannerTM helps you maximise your savings to prepare for retirement. It calculates how much you’ll need to retire, show how well you’re tracking towards your retirement goals and gives you an action plan on how to get you there. Simply start with including your estimated SASS retirement benefit balance and play with some different scenarios based on different paths you can take. To try it now go to aware.com.au/retirementplanner.
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