Why do people retire? It’s a fairly straightforward answer—or so it would seem. They reach a certain age, goal, accumulate a certain amount or maybe just decide it’s time. But it’s the nuances (and their understanding) that become more important for employers, according to a new survey from Towers Watson.
The reason?
“Partly because the role of employers has changed and partly because the traditional model of full retirement at a fixed date is on the wane,” the consulting and advisory firm notes. “How can organizations manage the exit of employees in critical roles? How can they help employees retire when the time is right and without regret?”
More than a quarter of surveyed retirees cited employer incentives — such as eligibility for retirement and retiree health benefits — as their main motivation to retire. Among more recent retirees, however, the relative importance of employer programs has declined, while workplace environment and eligibility for Social Security and Medicare play larger roles.
“As employer retirement and health care benefits become less generous (and early retirement incentives become rarer), employers wield less direct influence over their employees’ retirement decisions,” the survey found.
Retirees who based their retirement decision on eligibility for employer benefits or other employer incentives seemed to be enjoying retirement more than retirees with other motivations, and they were less likely to regret their decision to retire. Conversely, those who felt “driven away” by work pressures were more likely to be burdened by financial worries, have retirement come as a shock and regret their decision.
“As more people delay retirement, the work environment is assuming a larger role in retirement decisions, with workers’ feelings about their jobs becoming increasingly instrumental,” the firm concluded. “One in five retirees cited disengagement with their job as a key reason for deciding to retire. This is signaling that changing the work environment could open up alternative ways for employers to influence employees’ retirement timing, counterbalancing the receding impact of direct employer incentives.”