Great (Retirement) Expectations: A Review of Retirement Income Policy and Changes to Expected and Preferred Retirement Age of Australian Workers

Research Question/Issue: Retirement age expectations and preferences are shaped by individual, social, and government policy influences. Our paper reviews major policy changes in the Australian Retirement Income System over the past two decades and documents changes in Australian workers' expected and preferred retirement age. Research Findings/Insights: We identify three key results. First, workers prefer to retire earlier than they expect to, on average. Second, both expected and preferred retirement age increased through the 2000s and 2010s but stalled from 2017. Third, a significant proportion of workers do not know when they expect to retire. Practitioner/Policy Implications: In the absence of the ability to set a mandatory retirement age, a key objective of retirement policy has been to raise retirement age. Our results suggest that while workers' expectations and preferences reflect this, they have stalled somewhat. Further, a small but persistent proportion of workers do not form expectations which, given its importance in successful workforce exit plans and retirement wellbeing, presents a key challenge. Methods Used: We describe changes in policy over the past two decades before describing patterns and dynamics in retirement age expectations and preferences of workers aged 45–60, 2003–2023 using the Household, Income and Labour Dynamics in Australia (HILDA) Survey.