To retire or not to retire. The retirement challenge

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By Mike Middleton, Founder of personal development and retirement planners Pro-Vision Lifestyles ( 

Ask any business to explain how they deal with retirement advice with regards to their employees the chances are they will assume the question refers to “pensions advice.” This is just as true of banks as any other company.

Little or no consideration is given to the emotional and psychological challenges that most face when it comes to giving up work. This needs to change, not just because of the wellness agenda, important though it is, but also from a hard-nosed commercial viewpoint.

The bad news for most Western and advanced countries is that we are working longer and retiring later, a trend that is set to continue.  The good news is… we are working longer and retiring later!

Mike Middleton
Mike Middleton

It may seem odd describing working longer as good news, mad even. However, the reality is that most people dread retirement and approach the later years of their working life with increasing trepidation. The fear of no longer having a job, no longer mattering, the loss of status and a social network built up over decades, are likely contributors to poor mental health outcomes for the recently retired. Research found the risk of suffering from depression increases in the UK by a staggering 40% on retirement.

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With the abolishment of the retirement age in countries such as Britain, banks might fear having too many reluctant older workers clinging on, preferring long days in an amiable office to long days at home, at a loss what to do in a quiet house. In the coming years it will in fact be the opposite, as businesses of all types realise the shortage of youngsters means they must hold on to older workers and try to put off their retirement dates.

Demographic changes are already beginning to have a profound impact on our world; in the UK 20% of the population is over 65 and this number is growing. The Centre for Better Ageing predicts the number of people aged between 65 and 80 will grow by 36% in the next twenty years. Those businesses disregarding the value of older workers will pay a heavy price.

Changes to demographics are not the sole driver for the need to retain experienced older workers. As technology powers change in the world of work, younger employees are often having to learn and sometimes only want to learn, about new tech and future-based business opportunities. In the meantime, many banks have massive legacy systems, customers and revenue streams. Someone needs to manage and run this, not every aspect of commercial life can simply switch into a new super digital world with a mouse click or screen swipe.  Indeed, many aspects of banking including the relationship aspects benefit from people with plenty of grey hairs who have seen it before.

The good news about working longer and retiring later continues. Today people in their 60s and 70s are fitter and far healthier than those of previous generations. In turn this is leading to a desire to continue working.

The negative news we read about having to wait longer to access our pensions, is mostly due to our natural resistance to forced change and the removal of choice. This is evidenced by the number of retired people seeking to re-join the workforce.

Whilst it has been typical for many years for retired executives to retain a portfolio of employment or not-for-profit roles post-retirement, the idea of slowing down and phasing into retirement with reduced working hours is an alien concept for most.

With increasing demand for temporary and part-time roles, the scene is indeed set for older workers to enjoy the options of multiple small roles on a reduced number of working days. Management consultants McKinsey found in a 2016 survey that the young and the over 65s disproportionately participate in independent flexible working. Some clearly out of necessity but many out of choice. With the demise of final salary pensions, and a lower than needed savings rate amongst the working population the value in continuing to work becomes increasingly obvious. As we live longer our funds need to support us for longer periods.

What better way for a bank to retain skills than to encourage older workers to remain? Doing so not only helps the business transition but allows the individual to retain a sense of purpose, eliminate the fear and trepidation of change as they can more readily make the transition in stages. Employees who feel good and feel valued are frequently vocal advocates for the businesses that employ them.

After all, if a bank helps its people prepare for the transition to retirement in an holistic sense’ it will facilitate discussions ahead of time about how individuals may want to remain involved and employed. The greater the level of advance intelligence a company can gather, the easier it is to plan for the future. Retaining current workers is easier and less costly than finding new ones.

Having a clear plan for the future helps individual employees make far better use and plans for their savings and pensions, in turn employees tend to be more engaged with other benefits and rewards packages. With plan the level of anxiety about what the future might hold is greatly reduced. Less anxious people are more motivated and productive people, they are also less likely to be off sick and more motivated to manage their health and lifestyle, reducing the costs to the business.

All compelling reasons why banks should be leading the charge in their businesses to redefining retirement for the new challenges of the 2020s and beyond. Where they lead so their customers might well follow.

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