Amid falling confidence, 1 in 3 U.S. employees wants to phase into retirement

Core Insights - A significant number of older working Americans are opting for phased retirement rather than traditional retirement, driven by financial concerns and a desire for a gradual transition [1][2]. Group 1: Phased Retirement Trends - The 2024 Global Benefits Attitudes Survey indicates that 34% of workers aged 50 and older are either currently phasing into retirement (15%) or wish to do so (19) [2]. - Employees who began phasing into retirement at age 59 anticipate working for an additional nine years [2]. - Most employees currently phasing into retirement have reduced their work hours (61%) or job responsibilities (41%) [3]. Group 2: Motivations for Phased Retirement - The primary motivation for employees considering phased retirement is financial security (76%), followed by health (50%) and the desire for more time for family, leisure, and travel (45%) [3][4]. - Nearly half (46%) of older workers expect to work past age 70, a notable increase from 36% two years ago and 30% before the pandemic [4]. Group 3: Employer and Employee Perspectives - There is a mutual benefit in phased retirement for both employees and employers, as it allows employees to transition financially and emotionally while retaining experienced workers [5]. - Only 30% of employees feel their employers effectively utilize the skills of older workers, highlighting a gap in employer engagement [5]. - Two-thirds (67%) of employees believe mentoring younger colleagues is important before retirement [5]. Group 4: Importance of Retirement Plans - The survey reveals that 66% of employees consider their employer-provided retirement plan increasingly important, with 72% stating it is their primary retirement savings method [6]. - Over half (55%) of employees view their retirement plan as a key reason to remain with their current employer, an increase from 48% in 2017 [6]. Group 5: Employer Challenges and Solutions - Employers face challenges in meeting the flexible retirement needs of employees while addressing long-term financial requirements [7]. - Defined contribution plans are highlighted as essential tools for employers to provide flexibility and enhance benefits for employees preparing for retirement [7].