Your employees are planning for retirement years before you think they are

 

Most organisations treat retirement as something to address in the final stretch of someone's career. The reality, according to new LHH research, is that your people are already thinking about it long before it starts to get addressed by most employers.

We spoke to 1,000 white-collar professionals aged 50 and over, alongside 500 senior HR decision-makers across the UK and Ireland. The findings point to a significant mismatch that employees are mentally and practically preparing for retirement years earlier than their employers seem to realise.

The planning starts long before the conversation does

We found that nine in ten employees in their early-to-mid fifties have already started mapping out what life after full-time work might look like, and they have begun some form of preparation. On average, they expect to step back from corporate work in roughly seven years, and over a third anticipate making that move within a four-to-five-year window.

Yet a significant share of these same individuals do not feel ready for retirement. 15% say retirement still feels too distant to plan for, and others simply don't know where to begin.

These are not employees in denial about their future, but they recognise the need to prepare for retirement but lack the support to do it well.

That gap between awareness and action is exactly where timely employer support could change the trajectory.

HR knows the timing is wrong, but isn't fixing it

When we asked HR leaders what's going wrong with retirement support, the most common answer was that it comes too late in the employee's career, with nearly a third flagging this as the top shortcoming.

However, just 8% of HR leaders say they would prioritise starting retirement conversations earlier.

One reason for this is a simple lack of awareness about how far ahead employees are actually thinking. If retirement feels like a distant milestone to the organisation, there's no urgency for employers to engage with specific groups of their workforce, but our data suggests that this group is already thinking about their future, just without the employer's involvement.

Why earlier matters

A lot of retirement support is understandably focused on pension and financial security, and while this is the most important issue for most employees thinking of retirement, two other issues which are also key are defining what a person’s purpose and identity is when they retire.

These issues can take longer to consider and plan for, which is where employees seek retirement support from their employer earlier than many currently receive it.

Earlier intervention allows for more opportunities to be discussed from both an employee and employer perspective, including opportunities to structure a gradual transition through mentoring, consultancy, or reduced hours, and the knowledge transfer that should unfold over months rather than compressed into a rushed handover.

What HR leaders can do

The first move is simply recognising that employees in their fifties are actively thinking about retirement. That shifts the conversation from a last-minute logistics exercise to a strategic, multi-year transition.

The second is creating the conditions for earlier conversations, not by pushing people towards the exit, but by making it safe and normal to talk about the future. Effective line manager training is essential, and having a clear and open policy that signals that raising retirement is not shorthand for exiting the business.

Retirement deserves the same deliberate planning that organisations bring to recruitment, employee retention and restructuring, and for many employers, these conversations need to start sooner than they think.

Download the full report to explore the complete findings from our survey, including the five principles for getting retirement right.