Up until about twenty years ago, it was common for people to join an organisation for life. At retirement, if they were lucky they collected a superannuation lump sum or pension. Those without superannuation lived on the proceeds of their savings and personal investments, and/or the government age pension.
In more recent times there has been a shift in the way people retire. There are now large numbers of people for whom retirement is not a voluntary process, who instead find themselves forced to retire for a number of reasons.
With companies downsizing to reduce costs, it is common to find people in their forties and fifties taking a redundancy package and entering the job-search market for the first time in many years. Unfortunately, for many, being temporarily ‘between jobs’ may continue until they reach the stage where they decide that they are not going to find the type of role they are hoping for, and reluctantly declare themselves ‘retired’.
poor-health or injury (self or family member)
People may find themselves needing to take unexpected early retirement due to an ongoing health problem. Others may need to leave the workplace to care for an unwell family member.
A number of self-employed people in the research cited business closure as the reason for their retirement. Some, as in the case of those experiencing early retrenchment, entered the job market for a brief period of time before deciding to formally retire.
the effects of forced retirement
Forced retirement affects people in a number of ways.
- financial effects
At a financial level, it can mean that wealth accumulation plans are cut short leaving a shortfall in the amount of income/capital planned for retirement. Those finding themselves retired before a certain age may also find themselves locked out of their superannuation until they reach the minimum age required to access funds.
- emotional effects
At an emotional level, forced retirement can bring distress especially where people gain satisfaction from their job. The loss of status, together with the loss of social networks and a reduced sense of belonging, often hits people hard, partly because they have not had sufficient time to prepare psychologically for the severance.
what can I do if forced retirement is impacting on me negatively?
If you find that you are suffering emotionally from your unexpected retirement there are a number of things that you can do to help. Talk to friends and family about how you are feeling, the concerns that you have, and the aspects of work that you are missing. Talking matters through with a good listener can do wonders for your levels of anxiety and is the basis of many successful psychological therapies.
Alternatively, you may be missing the cut and thrust of work. If this is the case, then you need to identify what purposeful activities are open to you in your present circumstances.
If your forced retirement is due to your own poor health, then you may need to think laterally about activities that are manageable and enjoyable. One participant in the research, who was forced to give up oil painting due to severe arthritis, became involved in a book reading and discussion group, and found this satisfying. Similarly, an amateur poet who had always hand-written his poetry, was able to use a computer keyboard to continue composing poetry following early retirement due to a stroke.
Consider seeking guidance from a qualified financial adviser if forced retirement is causing you financial concerns. They can often provide you with useful advice and help you to reassess your financial plan if you have one, or to design one that will fit with your changed circumstances.
Financial advisers are also required to remain up to date with the regulations and laws impacting financial products and services. They may be able to suggest ways of accessing government benefits that you were not aware were available to you.