New research from Aware Super suggests a growing number of Australians are leaving the workforce earlier than expected, highlighting the importance of preparing financially for unexpected retirement.
A 2025 Retirement Study conducted late last year by Accenture Song on behalf of Aware Super found that one in six retirees over the past two years was forced into retirement ahead of schedule, with workplace stress, health concerns and redundancy among the key drivers.
Workplace stress, both physical and mental, was cited by 31% of recent retirees, up from 18% a decade ago, while 5% retired early due to redundancy. An increase in carer responsibilities for elderly relatives was cited as a third major reason.
Aware Super Head of Guidance, Lynda Cross, said Australians approaching retirement should factor in a cushion period or a window to ensure they are prepared if early retirement is thrust upon them.
“One of the best things to do is start with working out where you are at the moment,” Cross said.
“Ring your fund, check what you’ve got, check you’ve got no lost super left on the table. There’s $17 billion of it out there. Once you have your current position in hand, jump online and use some planning tools.
“There are some cool planning tools out there. We’ve got an easy one called ‘My Retirement Planner’ which can help you to plan a scenario. You can consider possibilities like ‘what if I made some extra contributions?’ What if I finished 5 years before I planned? What if I worked longer? What if I had an inheritance and I threw that into super?
When it comes to building a financial buffer, Cross said there is no universal rule.
“You can plan a whole bunch of scenarios and work through what your position might be if something were to happen and then start looking at what are some options for closing that gap, if there is a gap.”
Despite cost-of-living pressures, Cross said many Australians still view retirement as a distant milestone.
“Most people are thinking that retirement is probably further away than it potentially could be because of advances in health and medicine and life expectancy is increasing,” she said.
“But where this really comes into play is if there’s a curveball. If something goes wrong, that’s the bit that isn’t always considered.”
Catch-up contributions can also play a role in strengthening retirement savings, Cross said.
“It’s never too early to start. The power of compounding interest means that the earlier you start, the bigger every dollar is by the time it gets to retirement.”
Cross said concessional tax treatments were available on extra contributions made to super balances in the last five years before a planned retirement.
“You’re able to do that if your balance is under $500,000 and you haven’t used your full concessional contribution cap, which is $30,000 a year.
“In the previous five years, you can carry that forward and do it over the next five years. So essentially, you carry forward anything you don’t use each year for five more years.”
For members facing an earlier-than-planned exit from the workforce, Cross said advice services are available.
“We have a no-cost advice service for members. They can speak to a financial advisor as part of their membership who can help them work through where they’re at, what their position is, project out their numbers, give them some steps and an action plan to follow,” she said.
Reviewing insurance, investment strategies and potential government support can also make a difference.
“It’s important to make sure you’re aware of any Centrelink entitlements that are out there and could apply to you. About 70% of our members will be entitled to some government support and for the average member, that’s going to be about two-thirds of their retirement income will come from that and one-third from their super.”
Financial experts say the findings underscore the need for Australians to regularly review their superannuation and prepare for unexpected life events that could bring forward retirement plans.