When 70 is still too young to retire

Those of us of a certain age are well aware that the traditional retirement age of 65 is often no longer an option thanks to the global financial crisis and the likelihood many of us will live into our 80s and beyond. However, the conventional wisdom was that another few years of full-time earning would repair the damage and at least allow us to enjoy life by the time we reached 70.

A new study in the United States claims that even this later retirement date will be optimistic for many, especially those in low-paid jobs.

The Employment Benefit Research Institute, using 2007 as a benchmark, estimates that no more than 52 per cent of people aged 50 to 59 then would be able to have an adequate retirement income by the time they reached 65.

But this figure rose only to 64 per cent if they worked on until 70.

Of course these figures apply to the US, which has a different (and many would say highly inferior) superannuation regime to the compulsory superannuation system that operates in Australia.

We should be thankful for the fact that compulsory super exists in Australia. It would have been even better had the Howard Government not canned a contribution rise from nine to 10 per cent of income when it took office in 1996 and there is a compelling case for that figure to be raised to 12 per cent now.