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This commentary is written by Vanguard Principal, Corporate Affairs & Market Development Robin Bowerman. The title is Ageing, greying and still working

It was first published on Wednesday 8 August 2012

And is read by Michael Mullins

Please remember that advice in this podcast represents a general view. It is recommended that you seek specific financial advice, before making investment decisions.

A recent article in The Economist magazine - headed Sticking Around - relates how unprecedented numbers of older people are remaining in the workforce since the outbreak of the GFC.

There are probably no surprises in the fact that older people are remaining at work in Britain beyond traditional retirement ages. It is part of a long world-wide trend, including in Australia, which gathered pace with the GFC.

But what particularly stands out in The Economist article are the sheer numbers involved.

While the numbers of 16-24-year-old workers in Britain has fallen by almost 600,000 since 2008, the number of workers over 65 has risen by 240,000.

'Happily, people are living longer and healthier lives,' the commentator writes, 'which makes staying in work less daunting that it was.'

The unfortunate side of the equation is that the upheaval on investment markets is forcing many older people to try to remain working in an effort to boost their retirement savings – whether or not they like the idea.

Interestingly, the article notes that age discrimination among employers is decreasing. And, indeed, many employers appreciate the skills of older workers as well as their typical willingness to adjust their working hours.

The latest Retirement and Retirement Intentions, Australia report, published by the ABS, shows that 47 per cent of the people in the Australian workforce who intend to eventually retire nominate 65-69 years as their likely retirement age.

By contrast, the average retirement age of current retirees aged over 45 was 53.3 years. (This part of the ABS research covers all surviving retirees over 45 – whether they recently retired or had retired years earlier.)

Apart from the fulfilment that many older people gain from working past traditional retirement ages, there are key financial rewards.

By extending your time in the workforce, you may have the opportunity to increase your retirement savings. And by having fewer years in retirement, you may need less money than otherwise to achieve a satisfactory living standard.

The ABS figures indicate that of the workers who intend to retire one day from full-time occupations, 16 per cent plan to phase-in their retirement by switching to less-demanding duties with the same employer.

Although 12.8 per cent of the workforce 'never intends to retire', a person's intentions and what actually happens in reality often differs.

And that concludes the column

Ageing, greying and still working

from Robin Bowerman,  Principal, Corporate Affairs & Market Development at index fund manager Vanguard Investments Australia

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Please remember that advice in this podcast represents a general view. It is recommended that you seek specific financial advice, before making investment decisions.