HR trends and what they mean: Retirement dreams

How does the way we think about retirement differ across generations? According to the latest report from Edelman Financial Engine, 37% of respondents desire a different retirement lifestyle than previous generations. This is especially true for millennials, who are seeking a more active or adventurous post-career lifestyle. 

Economic malaise and shifting beliefs of what it means to be wealthy has had a substantial effect on younger generations and their aspirations for when their careers conclude. This is especially evident in the rise of ‘treat culture,’ prioritising short-term indulgences over long-term returns.  

Or it’s taking shape in ‘micro-retirements,’ essentially sabbaticals, which are shooting up in priority for a younger generation concerned with burnout (which we also know a lot about). All of this matters to HR professionals because it re-contextualises the concept of ‘total reward.’

The prospect of retirement, and how it's perceived, will undoubtedly have an impact on employees in their day-to-day working lives. It influences where they work, how they work, and how they feel about where they work. In short, your highest performers are always aligning their current prospects to their future goals. 

And that matters when cultures are trying to establish a culture of appreciation:

The boundaries between work and life have blurred significantly over generations. We think less about “work-life balance” in today’s world and more about life blend. Our baby boomer generations lived a workplace era in which work was a much more segmented period of time with little space for life experiences and luxuries. In turn placing a greater emphasis on the “when I retire” plans. 

Whereas in today’s world, people expect to have life experiences in amongst their work, the opportunity to take work with them when they travel if they so choose. We are likely to move further away from the concept of a defined age as to when they might “retire” as the finite timeline is no longer needed.

When we think about what workplaces can do to support this, we need to enable flexibility, development for people to grow and thrive in their career skills and experiences, as well as the right financial benefits which enable the desired life blend and the ability to mix life and work experiences.” explains Nebel Crowhurst, Chief People Officer at Reward Gateway.

As generational shifts redefine retirement and reward expectations, HR teams must adapt to these evolving trends to attract and retain talent. Here are some strategic approaches to consider:

• Prioritise planning: If planning for the future is top of mind for younger generations, you may want to consider introducing benefits like financial education programs to help keep them engaged. 

• Hone in on wellbeing: The desire for micro-retirements may highlight a dearth of wellbeing opportunities. Consider benefits like self-care days or stress management workshops. 

• Embrace total reward: It may be time to revisit how your organization approaches your total reward strategy. Check out our Personio Masterclass on the subject for a helpful leg up.

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That's all for this week's edition of Personio Pulse: This Week in HR. Check back next week as we continue to dissect the latest trends impacting the ways we work. 

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