We need to change how we talk about retirement at work

For some, retirement is a milestone to celebrate openly with their workplace peers – a confidently shared countdown bubbling over with ideas for travel, family time or long-awaited hobbies. For others, it’s a secret closely guarded until the last moment.

Why is retirement such a taboo topic in so many workplaces? And, more importantly, what are the financial and professional consequences of staying silent – for you and your boss?

Why is retirement such a taboo topic in so many workplaces?Credit: AFR

In my Facebook Group, the Epic Retirement Club, members often ask to post anonymously, afraid their colleagues might uncover their plans or even associate them with the “retirement genre” as if it’s a dirty word.

This hesitancy is rooted in fear – of being sidelined or treated differently before they’re ready, and that their workplace doesn’t have their back.

With only 31 per cent of Australians retiring by choice in 2024, it’s clear many feel they have no control over when or how they leave work unless they stay silent. Staying silent, however, often makes things worse – and it certainly perpetuates the cycle.

Workplaces would be more appealing if they tried harder to combat ageism and created cultures where workers felt they could discuss their future.

Why workplaces should evolve

Workplaces are changing rapidly. The signs are clear: AI and automation are driving significant transformation across industries. Entire roles are being redefined or phased out in some sectors, while others are grappling with labour shortages that hinder growth.

At the same time, the concept of retirement is shifting too. Gone are the days when employees worked until December 20, clocked off, and never returned to the workforce.

Increasingly, research shows that a gradual transition – working less overtime or exploring part-time phases and taking sabbaticals before full retirement – can provide significant benefits for both employees and employers.

Many older workers choose to access their super while continuing to work, maintaining their engagement with the workforce. Thanks to remarkable improvements in health spans, many people have both the energy and expertise to contribute meaningfully, albeit in new and different ways.

Employers who ignore these trends risk losing invaluable experience and effective succession planning opportunities that might help them to embed responsible work practices in younger employees.

Open conversations about retirement also unlock many win-win outcomes. Such discussions could help employees navigate the often-confusing run-up to retirement with clarity and greater confidence.

They could also enable phased retirement programs so employees gradually reduce their hours while maintaining some involvement. Employers could offer part-time or project-based roles that leverage the strengths of older employees while meeting organisational needs to shift costs.

Finally, they could introduce mentoring programs where older employees transfer their knowledge, fostering continuity and goodwill.

The fact is, employees who leave a workplace by choice are far more likely to adapt well to retirement and maintain positive feelings about their former employer. In contrast, those retrenched or forced out often face significant psychological impacts, with studies showing it can take two years to recover a sense of competence and self-worth.

For employees nearing retirement and counting down who want to be supported by their employers, staying invested in your work is essential.Credit: Getty.

Secrecy, however, undermines these possibilities, leaving employees and employers unprepared. Employers could do things to encourage older workers to stay engaged, loyal and enthusiastic instead, taking the journey together as they do with maternity leave.

Workplaces would be much more appealing if they worked harder to combat ageism and created cultures where employees felt safe discussing their futures and visions of retirement.

Providing resources such as retirement education programs or access to financial advice can help employees make informed decisions too – so they don’t fear leaving the workforce one day and hide from it.

Offering tailored options – such as phased retirement programs or project-based roles—can keep older workers engaged while ensuring the organisation benefits from their expertise. Supporting employees in this way isn’t just ethical; it’s strategic.

Why older workers should stay engaged

There’s another conversation we have to have – and it shouldn’t all be on the boss. For employees nearing retirement or counting down, who want to be supported by their employers, staying invested in your work is essential to maintaining the respect and ongoing support of your employer.

They are paying you to do a job, and that job usually requires you to stay up-to-date and interested in what you’re doing, even if the end is nigh. Keeping your skills sharp and your professional attitude strong can open doors to flexible arrangements – but only if you’re proactive.

If this is you, then take time to talk to your employer about options such as reducing hours, taking on a mentoring role, or adjusting responsibilities. If you show you’re still engaged and valuable, employers are far more likely to accommodate your needs.

There’s a financial incentive too. Employees who discuss their plans can leverage smarter strategies in their final years of work with the boss’ support. Things such as:

• Phased retirement, gradually reducing your hours, stepping down your work income carefully and allowing time to adjust your budget and retirement plans as you experience the changes.
• Salary sacrifice, boosting your superannuation contributions using voluntary salary sacrifice during your final working years to maximise savings before you finally stop work.
• Using your leave strategically by allocating your accumulated leave to extend your earnings or create a buffer for your transition.
• Or taking your long service leave as a sabbatical rather than a payout. It’s often more effective to take it while still employed rather than cashing it out. This way, you’ll earn superannuation on the long service leave pay and retain insurance benefits such as life and TPD coverage during that period.

These options can stretch your savings and super over a longer period, but they’re usually only accessible if you’re willing to have the conversation. And conversations are a two-way street.

Bec Wilson is author of the bestseller How to Have an Epic Retirement. She writes a weekly newsletter at epicretirement.net and is host of the Prime Time podcast.

• Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making financial decisions.

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