The 2021 HILDA Survey
The Household, Income and Labour Dynamics in Australia (HILDA) Survey follows the lives of over 17,000 Australians each year.
It collects information on many aspects of life (eg household and family relationships, income and employment, and health and education), which, among other things, can be useful for public policy.
One of the 2021 HILDA Survey focus areas was the collection of retirement information such as timing of retirement, super balance at retirement, and prospective plans for retirement.
Below are several of the key findings on retirement from the 2021 HILDA Survey, plus links to useful content resources for additional information on the areas touched on.
2021 HILDA Survey findings
Trends in the age of retirement
Retirement from the workforce is one of life’s major events.
- In the period 2001-2004, 46.5% of men aged 60-64 and 68.4% of women aged 60-64 were retired. Whereas, in the period 2017–2019, it was 33% of men and 45.8% of women in this age range.
- In 2003, the mean age at retirement of recent retirees was 61.6 years for men and 61.0 years for women. Whereas, in 2019, it was 66.6 years for men and 65.1 years for women.
Prevalence of transitions out of retirement (returning to work)
Retirement is typically perceived to be a one-time event—people retire once, never to return to work again. However, this is not always the case, for one or a combination of reasons.
- In the period 2001-2004, 11.7% of retired men aged 60-64 and 7.3% of retired women aged 60-64 returned to work. Whereas, in the period 2017–2019, it was 7.7% of men and 4.1% of women in this age range.
Factors impacting on the timing of retirement
The timing of retirement is often influenced by a culmination of factors (eg financial readiness for retirement, health, employment opportunities, individual preferences, and the desire to coordinate with one’s partner).
- In terms of the impacts of life events on the probability of a person entering retirement, the following rated high for men and women: turned 65 in the last year, in poor general health in the year prior to the current year, death of spouse or child, fired or made redundant by an employer, and partner retired in the last year.
- The main reasons for retirement of persons who retired within the preceding four years: involuntary job-related (eg made redundant), own poor health, poor health of another (eg partner or other family member), voluntary family/life (eg partner had just retired), and voluntary financial (eg eligible for Age Pension).
Superannuation of retirees at the time of retirement
Our retirement income (and outcome) can be affected by the sources of income (eg retirement savings) we can and are able to draw from—and how we use them. For many, super forms a key part of retirement savings.
- In the period 2011-2015, the proportion of retirees who had super and the subsequent mean super balance at retirement was 80.8% and $475,259 for men and 84.9% and $253,027 for women. Whereas, in the period 2015-2019, it was 80.9% and $476,744 for men and 88.1% and $289,277 for women.
- In the period 2011-2015, the proportion of retirees who spent at least some of their super at retirement (eg paid off debts, paid for large-expenditure items, or assisted family members) was 12.7% for men and 16.9% for women. Whereas, in the period 2015-2019, it was 16.3% for men and 14.7% for women.
Retirement expectations of people not yet retired
Everyone has different financial situations, goals, and objectives—this is coupled with differing ideas and expectations, particularly around retirement. However, at times, there can be similarities.
- In 2011, the mean self-reported (by non-retired persons aged 45+) expected annual after-tax income required for a satisfactory standard of living in retirement was $49,963 for singles and $67,715 for couples. Whereas, in 2019, it was $46,752 for singles and $69,052 for couples in this age range.
- In 2003, the mean expected and preferred retirement ages of non-retired persons aged 60-64 was 66.2 years (expected) and 64.5 years (preferred) for men and 65.9 years and 63.6 years for women. Whereas, in 2019, it was 67.4 years and 65.1 years for men and 66.7 years and 64.9 years for women in this age range.
- In 2003, the proportion of non-retired persons aged 60-64 not expecting to retire and preferring to never retire was 12.8% (not expecting to retire) and 14.2% (preferring to never retire) for men and 13.7% and 18.1% for women. Whereas, in 2019, it was 8.2% and 3.4% for men and 6.2% and 4.9% for women in this age range.
Moving forward
When it comes to retirement wellbeing and security, it’s key to remember that everyone has their own financial situation, goals, and objectives, which also means our ideas and expectations about retirement can differ.
Therefore, in terms of securing your own retirement wellbeing and security, taking time to understand your financial situation, goals, and objectives—and having an appropriate retirement plan in place—is a step in the right direction.
For more information about this topic, contact Carrick Aland’s Wealth Planning team on 1300 466 998 or visit carrickaland.com.au/wealth-planning/.
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