Financial Worries of Older Australians

Hard work

“Seeking employment. Very fit worker.  Occasional bad back.  Would suit work on a fast production line.  A little hard of hearing.  Very strong, able to lift heavy weights, as long as back doesn’t go.  Please ring Bill Smith, age 67.  Any employers interested?.”

Jobs are wanted to  beat the retirement blues. “Bill” might have used a pseudonym but he is no doubt speaking up as one of the ageing Australians who can’t afford to retire.  Nor can the government afford for Bill to retire. Gone are the good old days.  Age Discrimination Commissioner, Susan Ryan, says the booming aged population poses a ”massive” call on the public purse. It’s no wonder, when many retirees will spend a third of their life in retirement.

But the reason Australia now has an age discrimination commissioner speaks for itself. The jobs aren’t on offer for older workers.   Ms Ryan has called for a big rethink by employers about hiring the many jobless 55- to 70-year-olds keen to work. In 2010 the Bureau of Statistics identified one in five Australians over the age of 55 were actively looking for work.  Many older people love to be involved in the workforce and see it is as way to lead a more fulfilling life.  For many others, whose biggest worry is their dwindling nest egg, it’s about the money.  In a survey released in June, 2012, as part of the National Seniors Australia productive ageing forum, new research findings show the greatest concern of the over-50s is shrinking finances – 70 per cent of women and 61 per cent of men worry their savings will not keep pace with inflation. And nearly 50 per cent of National Seniors members have, or intend to, delay their retirement for financial reasons, the research found. Keep in mind that these figures doesn’t even cover many pensioners who rely completely on the government and don’t see issues of market volatility and shrinking finances as relevant to them.

There’s likely to be a huge impact on the pension bill facing the government, and yet according to Ms Ryan this doesn’t have to be the case because ”there is a pool of up to 2 million skilled and experienced locals” representing Australia’s “greatest available pool of employee talent”  in the 55 to 70 age group, who are either not working or underemployed.  This is a gross waste of our natural human resources.  ”What lies at the core of all this waste appears to be age prejudice, age discrimination.”

Age itself may not be the biggest block to employment.  There are discriminatory age-related limits linked to workers compensation, income protection insurance, superannuation rules and trades insurance, which make it very difficult for employers to give older workers “a go”.  The June meeting has put these issues more prominently on the national agenda, and Ms Ryan is planning to advocate for changes that will decrease bureaucratic obstacles to employment for older workers.

Meanwhile for many of the current generation of longevity boomers it’s a matter of battening down the hatches, watching the interest rates fall, cutting spending, growing veges, hoping for better times.  But it’s just as well for the government to start getting its act together now. The financial impact of the longevity boom is only in its infancy.  Presently in Australia the majority of retirees own their own home which significantly cushions the impact of lower income in old age.  This will not be so for subsequent generations, as home ownership becomes increasingly unaffordable.  Ms Ryan points out, for example, that ”half the girls born today will live beyond 95” yet women particularly experience financial disadvantage as they age.

3500 people ranging in age from 50 to 85-plus took part in this survey which is entitled “Financial Wellbeing: Concerns and choices amongst older Australians”.  It is a collaboration of Australian National University, AMP, Rice Warner Actuaries and National Seniors Australia. Read more here.