Only one in five public servants want to stop working completely when they leave government employment, according to research undertaken for State Super Financial Services.
The CoreData survey on the financial attitudes of 2500 public servants shows that despite common assumptions people want to just spend a carefree time in retirement, the reality is public servants are looking for activities and purpose when they retire from government.
Over 40% want to continue working either full or part time and more than half want to do some form of volunteering. Travel, socialising and recreational activity such as walking all rated highly as planned activities. Nearly half of respondents were looking to help take care of family and grandchildren.
Activities planned or already doing in retirement
|Taking care of family||48.7%|
Source: CoreData April 2014. Sample of 2496 public sector employees; the majority of those surveyed were in the 45-64 age group.
However, the data also reveals over a third of public servants are unsure what they want do and this can lead to problems when considering redundancy.
Because older public servants are more often on defined benefit schemes where they can expect a regular pension from their superannuation, lifestyle choices in retirement need to be carefully considered to match these benefits. And decisions whether to take a lump sum can have later in life consequences.
The Mandarin recently hosted a webinar with certified financial planner Jason Andriessen from State Super Financial Services to discuss how public servants should realistically consider their retirement lifestyle expectations and financial objectives for what could be a 30-year retirement period.
Their choices about post-retirement “work” have tax and cashflow implications — and in turn these factors have a significant bearing on how ex-public servants who have taken redundancy plan for their retirement.
Similarly, choices about housing and location can have a significant impact on both how much money is available and how much financial flexibility is possible in later years.
For example, selling up and moving to the coast can initially be a happy choice, but if this does not work out it can be difficult to come back to more expensive housing in the city. And as retirees get older there is a need to be closer to better medical facilities.
Funding aged care and housing can be problematic if earlier decisions around financial planning do not factor in lifestyle and family objectives.
Another consideration is to include partners closely in retirement discussions. The data reveals late life divorce is on the rise and so-called grey divorce can have a major impact on retirement financial plans .
The Australian Institute of Family Studies demographer Lixia Qu recently told social analyst and writer Adele Horin there’s been a doubling in the proportion of men aged 50-64 who are divorced (from 7% in 1991 to 14% in 2011). For women, the rate of growth is even higher with a 125% increase for the same age group (from 8% to 18%).