Employees’ perception of retirement differs from reality

The survey also reveals the following:

• 38% of pre-retirees expect to retire by ages 65 to 67, and 15% of pre-retirees do not expect to retire. Of the surveyed retirees, nearly 30% retired under the age of 55, and another 24% retired between ages 55 to 59.
• 41% of pre-retirees plan to stop working for pay all at once, compared with 78% of retirees who stopped working for pay all at once. Another 35% of pre-retirees plan to work for pay part-time or periodically.
• Health problems would be the primary reason for an early retirement, according to 42% of the surveyed pre-retirees.
• One-quarter of both pre-retirees (25%) and retirees (27%) said disability or no longer being able to cope with the physical demands of the job would lead to an early retirement.
• Both the surveyed retirees and pre-retirees plan to reduce spending, increase savings and reduce debt to manage retirement risks. More than 90% of both pre-retirees and retirees plan to eliminate all of their consumer debt. A majority (93%) of pre-retirees plan to save as much money as possible, and 88% of pre-retirees plan to cut back on spending to manage risks.
• Both retirees and pre-retirees have a median planning horizon of 10 years. Roughly 45% of pre-retirees think it is very possible to plan for day-to-day expenses, though they are less likely to plan for other issues in retirement.

“Many people may not be able to physically work full time into their later years, or they may be faced with unexpected risks and shock events impacting their savings and retirement income,” says Anna Rappaport, chair of the Society of Actuaries’ committee on post-retirement needs and risks.

“What is also troubling is that many retirees end up retiring much earlier than planned,” she adds. “In the 2013 survey, pre-retirees expect to retire at a median age of 65, but the surveyed retirees had retired at a median age of 58.”

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• Workers fall behind on retirement preparedness
• Women less confident about retirement saving: Study
• Some Canadians don’t retire when they want