For those not up on the latest retirement news, Denmark recently raised its retirement age to 70, noteworthy because that is an affluent, developed market with considerable social safety nets. The country is easing into the change as it will go into effect in 2040.
Still, the OECD points out that several other European nations are considering following suit, adding that by 2060, Denmark’s retirement age could be 74 years old. Denmark’s population is 5.94 million, making it smaller than some U.S. cities, but there are potential implications for American retirees. Yes, 62 is still the earliest age at which Social Security benefits can be claimed, but the normal retirement age, or the age at which full benefits can be claimed without reductions, is 67 and it’s been on the rise for four decades.
One of the obvious takeaways, particularly for workers without access to defined benefit pensions, is that the earlier they start saving for retirement, they enhance their odds of making work optional while setting themselves up for a potential lengthy retirement where work is an afterthought.
Understandably, few people want to work longer than they have to and no one is clamoring for Congress to continue raising the age at which retirees can get maximum Social Security payouts, but some data points indicate there are benefits to remaining in the workforce.
With Age Comes Confidence,
It’s often said that “with age comes wisdom.” In retirement terms, it can be said that with age comes confidence. Maybe.
State Street Global Advisors’ (SSGA) 2025 Global Retirement Reality Report points out that since the December 2024 survey, the number of people expecting to retire before age 65 is down 8% while the number forecasting retirement between 65 and 69 is up 4% as is the number expecting to leave the workforce at 70 or older. However, the newest edition of the study also indicates higher levels of retirement confidence.
Predictably, there are split views. Sure, it’s easy to understand why workers’ retirement confidence increases if they’re deciding to remain employed longer. On the other hand, many feel they’re forced into that situation.
“For many, inflation, rising healthcare costs, and concerns about income sustainability in retirement are influencing the timeline — and the terms — of their retirement,” according to SSGA. “Partial retirement, then, becomes less of a preference and more of a coping strategy. And it highlights the gap between what people hope retirement will look like and what their financial reality will allow.”
Beyond lifting the retirement age, there are more attractive avenues for boosting retirement confidence. Those include education and investments held outside the confines of retirement accounts, making advisors essential in the retirement confidence scenario.
(Image Courtesy: SSGA)
Teamwork Makes the Retirement Dream Work
When it comes to retirement, planning is essential. So is partnership. Translation: the more closely aligned advisors, plan administrators and employees are, the better odds are of retirement success for workers – the preferred outcome for all involved parties.
Getting there requires a combination of succinct explanation of benefits, the right plan and the appropriate leveraging of technology.
“Understanding the different concerns facing participants at different stages of their journey can help inform relevant communications. And don’t forget that they may need additional support in times of uncertainty,” concludes SSGA.
Related: Women Want Financial Empowerment. Advisors Should Help.