HomeRetirementRaising retirement age impacts health and wellbeing, study finds

Raising retirement age impacts health and wellbeing, study finds

Forcing someone to retire later than they’d like can have a significant impact on a person’s health and wellbeing, research reveals.

Only 30 per cent of Aussies can afford to retire before they are eligible to receive the Age Pension, a study from Adelaide’s Flinders University has found.

Taking away people’s autonomy like this is having a detrimental impact on these individuals’ health and overall wellbeing.

And with the official retirement age going up  to 67 in July this year, the researchers behind the study say forcing delayed retirement on people is having a number of unintended consequences that risk undermining retirement completely.

Dr Rong Zhu, co-author of the study, says one of these consequences is people feeling a lack of control over their lives and the way in which they live.

“We need to consider the unintended consequences of delayed retirement for health and wellbeing via a reduced sense of internal locus of control,” he says.

“If workers work beyond retirement age, they are less likely to consider [their] life outcomes as a result of their own choices and actions.”

Dr Zhu says the result is public policy that focuses too much on the monetary side of the Age Pension, and not enough on achieving positive outcomes for older Australians.

He says retirees in this position face losing several years’ worth of the benefits of retirement.

“Facing an increased eligibility age for the Age Pension, if an older person defers retirement, then the health and wellbeing benefits associated with retirement also come at a later date.”

This may seem like a problem just for those who haven’t saved for retirement, but take-up of the Age Pension in Australia is around 70 per cent, the second highest in all the OECD countries.

And with an increasingly older population, the question of how to fund the pension and aged care system needs to be asked. But, says Dr Zhu, forcing people to extend their working lives is not the answer.

“Our paper shows retirement significantly improves older people’s physical and mental health as well as their subjective wellbeing as measured by life satisfaction,” he says.

But the recently released final report from the Aged Care Taskforce found the proportion of older Aussies accessing the pension is expected to drop about 15 per cent over the next 40 years – thanks to appreciating superannuation and assets.

That same report recommended wealthier older people should contribute more to their aged care costs in order to take aged care funding pressure off the government. Currently, the federal government contributes around 75 of the cost of residential aged care and 95 per cent of home care costs.

Former NSW premier Mike Baird,  who is a member of the Aged Care Taskforce, says changes are needed to ensure Australia’s retirement and aged care systems continue to operate into the future.

“There are constraints and demands across all parts of [the] budget,” he said.

“Asking those who have the means to contribute more is a logical step and having a safety net for those that don’t have the resources also provides some protection, so it’s a good balance.”

Were you forced to retire later than you’d have liked? When would you have liked to retire? Let us know in the comments section below.

Also read: The ‘generational sandwich’ crisis creeping up on us

Brad Lockyer
Brad Lockyerhttps://www.yourlifechoices.com.au/author/bradlockyer/
Brad has deep knowledge of retirement income, including Age Pension and other government entitlements, as well as health, money and lifestyle issues facing older Australians. Keen interests in current affairs, politics, sport and entertainment. Digital media professional with more than 10 years experience in the industry.


  1. I’m a single female and not having my super paid by former employees has heavily impacted my retirement. I’m soon to be 70 and am only working a few hours a month now but have worked since I left school. Also super funds need to be looked at as many are under performers and charge excessive fees

  2. I believe the fairest and most practical way of establishing a retirement age would be based on the number of years of taxable working years undertaken. As an example, everyone could retire after 47 years of taxable work. This means a person who has been working in manual jobs and has probably started shortly work after leaving school can and would need to retire earlier than someone who has attended uni, probably joining the non-labour work force would and be able to physically retire later. A period of say five years for each child raised could be reduced from the standard years. Presumably those undertaking multiple degrees would be earning a sufficiently higher salary to not require the OAP so the standard years of work would be irrelevant.

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