Can you envision continuing to work into your 70s?
Estimates suggest that the number of people worldwide over the age of 60 will more than double in the next 26 years (by 2050). Based on a study by S&P (2023) covering 81 countries, the typical government, without pension system reforms, would record a deficit of 9.1% of Gross Domestic Product (GDP) by 2060, compared to 2.4% in 2025.
We are living longer, spending over a quarter of our lives in retirement. However, thanks to medical advancements, we are also healthier and could therefore work longer.
In Japan, a country leading in life expectancy, it's already common for a quarter of retirees to continue working past the official retirement age. This trend is particularly pronounced among those aged 65 to 69, with every second person still employed.
In Switzerland, the average retirement age in 2022 was 64.8 years, with about a third of individuals still working at 65, according to the BFS, and about 10% continue working beyond the standard retirement age, Statista reports.
Is it time to rethink traditional retirement?
Life evolves, and the clear divisions between childhood, working years, and retirement are increasingly blurred.
A SwissLife study from 2021 reveals that nearly half of those aged 55 to 70 (49%) are open to, or already are, working longer if their health permits and their efforts are valued. The study further finds that two-thirds of those in retirement age work because they love what they do. However, others willing to continue face barriers to opportunities.
I wish I could have started something new at 55 or 57 instead of being trapped in a pre-retirement limbo. I asked, but my employer wasn't interested.
In January 2024, the number of unemployed individuals aged 50-64 in Switzerland rose by 1,683 persons (+5.6%) to a total of 31,807, according to SECO.
Experienced individuals can still contribute significantly, offering valuable insights into productivity and innovation, especially during skilled labor shortages. Data already shows that middle-aged startup founders, around 45, tend to be more successful.
With better health, the possibilities for later life are vast, with various platforms and counseling services available for careers post-retirement. The sooner one starts planning for financial longevity, the more freedom older adults will have in the future.
Should we be working longer?
Continuing to work past the conventional retirement age, if health and vitality allow, offers immense benefits that extend beyond maintaining a standard of living or economic necessity. It can provide personal fulfillment, enable the sharing of experience and knowledge through mentoring or project work, and contribute significantly to society, not to mention the health benefits associated with active mental engagement and social interaction.
As we debate raising the retirement age, we must also consider how to create an environment where continued work and financial planning for a life up to 100 are achievable. This includes modern part-time work models, connections to pension systems with smaller contributions, further education and retraining opportunities, and pension systems that support continued work or re-entry into the workforce after a care break and allow for later contributions.
5 tips for financial longevity
No matter the pace of pension system reforms, a forward-looking financial plan is a key to freedom, offering space for creativity and opportunities to fulfill dreams, both professionally and personally. Here are my five evergreen tips for ensuring your finances endure:
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- Create an emergency fund to keep you on track no matter what.
- Utilize all available pension provisions (state, employer, private pension), even if retirement seems distant.
- Invest in securities that match your risk profile where possible.
- Stay informed about changes in pension provisions—being well-advised can prevent costly mistakes and help you capitalize on new opportunities early.
- Plan for a flexible working life "out of the box." Work is becoming more flexible and location-independent. Whether you're considering spending part of your time abroad or embarking on a completely different career, these aspirations should be part of your financial planning.
What's your take on financial longevity? Can you envision working beyond your 70s?
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The original version of this article has been published February 2024 by Olga Miler on Watson News in Switzerland