Retirement needn’t be a sudden career halt: India needs to re-imagine it as a gradual transition

WisdomCircle, in partnership with Dalberg, surveyed over 1,000 experienced professionals and retirees aged 55–80 across India to examine how they view work and retirement. The results were stark in highlighting how experienced professionals are rethinking traditional definitions of retirement. It no longer is viewed as an end; it signifies a transition to a new way of living. Our lack of transition support systems is a key reason many feel adrift.

After the age of 65, the average retirement age, the proportion of adults looking for new opportunities increases, indicating that there is a desire to engage in some form of activity, whether it’s a job, volunteering or participating in community-oriented work. Globally, labour force participation for 60-year-olds and above has risen significantly. In the US, for example, the labour force participation rate for people aged 55-64 rose from about 55% in 1990 to about 66% in 2023, and in the EU, from about 38% in 2000 to 60% in 2020.

This study, like others, shows that older adults would like to remain in or rejoin the workforce if given a suitable opportunity. What might explain this desire to continue engaging after retirement? Most respondents attribute this to a desire for structure and routine, and their need to find purpose, a trend backed by multiple other studies.

This desire to be professionally engaged is reflected in demand on platforms like WisdomCircle, where on average there are 40 candidates for every opportunity. The reason for this mismatch is the nature of the roles desired. Older candidates seek flexible, low-bureaucracy, experience-leveraging roles, which require specialized skills associated with advisory positions.

Globally, most new entrepreneurs or business owners are retirees and not young workers.

Rather than spending retirement travelling or volunteering, nearly half of those surveyed wanted some sort of professional engagement. Organizations could leverage this insight to better prepare their employees for retirement by hiring them on a part-time or consulting basis, or even to mentor and upskill younger employees. It acts as a win-win for both, given the gains this can yield in shaping careers.

While there is immense demand for work after retirement, the institutions needed to facilitate this transition are limited. About 60% of the survey’s respondents said they received little to no support from their organizations in preparing for retirement, beyond basic financial preparation. If only nine-to-five job roles are on offer, then employers lose out on long years of expertise that retirees have built along the paths of their careers.

Unfortunately, it would seem that many of the public institutions meant to support the retirement transition are not fit for this purpose. Some interviewees, for example, highlighted that they were unable to access their pension and provident funds (PF), or even health insurance.

A consequence of this is that rather than being reflective or restorative, the journey to retirement is filled with bureaucratic hurdles. On average, 25% of all PF claims are rejected, while pension-specific requests are rejected nearly 40% of the time. Key reasons include inconsistent bank accounts, employers having shut down without updating details, and various verification issues, rather than the validity of PF claims.

Financial systems designed for full retirement by a specific date can get in the way of gradual transitions. To remedy this, India has taken some measures, but could explore further ways to improve the flexibility of its PF system so that workers can more easily withdraw part of their retirement savings while continuing to work. Cases of withheld funds, especially those due to technical reasons, also need to be minimized.

As younger countries begin to age, they must rethink how their institutions are geared towards the task of helping individuals transition to a new phase of life. Canada’s pension plan, which is highly flexible, is instructive in this context. People aged 60 and above can easily withdraw some of their pension to fund expenses and keep contributing to it as well, allowing them to treat retirement and work as a choice. Its design helps workers transition gradually into retirement or freelance work, with the result that old-age financial hardships are rare.

Financial concerns are not the primary drivers for retirees to seek work, but making it easy to access one’s retirement kitty would expand their scope of choices.

India has a youth demographic dividend, but it also has sizeable and growing older workforce that could support community organizations, companies and even set up new businesses. Retirement is no longer a clear break, but a slow transition. If the survey’s respondents, who are largely urban, highly skilled and educated, struggle to adjust to this new phase of life, the journey for others may be even harder. Institutions and individuals both need to re-imagine what retirement can be; another journey of active engagement, not the end of a career.

The author is a senior policy advisor at WisdomCircle. He tweets @VibhavMariwala.