When it comes to retirement expectations or how long they need to work to afford a comfortable retirement, employees differ greatly in their view of developing and developed economies.
The survey also found that, in most economies, a majority of employees are confident of being able to afford 15 years of retirement. But confidence declines substantially when employees are asked to look further into the future.
In developed economies, typically two-thirds of respondents believe their financial resources will support 15 years of retirement, but less than half are confident when considering 25 years into retirement.
“Despite improving corporate financial performance in developed economies and more benign economic conditions in developing economies, large numbers of employees have undergone considerable change and uncertainty in the workplace,” says David Speier, a senior consultant at Towers Watson. “As a result, many workers have become more insecure about their jobs and finances.”
Most employees globally believe they are behind schedule on saving and find it difficult to catch up because they may not have the financial means to do more in this environment.
“It’s no wonder that retirement security has taken on heightened importance for employees worldwide, with the majority in all economies recognizing the need to save more, both generally and specifically for retirement,” he adds.
In most of the developed economies, one-third to nearly one-half of respondents have decided to extend their working years, often substantially.
The average increase is five years in Australia and the United States; four years in Canada, Japan and the United Kingdom; and three years in Germany and the Netherlands.
As a result, the average anticipated retirement age is now over 65 in Australia, the Netherlands, the U.K. and the U.S. On the other hand, in developing economies, most workers haven’t changed their anticipated retirement age over the past three years. And of those who changed their minds, more expect to retire sooner rather than later.
There were 22,000 employees from 12 countries who participated in the survey.
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