By Michael Yardney February 25, 2026

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The Great Unretirement: How Baby Boomers Are Quietly Rewriting Australia’s Future

Michael Yardney's Commentary
The Great Unretirement: How Baby Boomers Are Quietly Rewriting Australia’s Future

Key takeaways

Retirement is shifting from a fixed age to a gradual transition, with many Boomers choosing to work longer for purpose, identity, or financial necessity.

Boomers are increasingly asset-rich but cash-flow poor, and downsizing no longer solves the problem due to taxes and lack of suitable housing.

Two groups of Australians are emerging in retirement: those with financial choice and those forced to work longer due to limited super and rising living costs.

Australia’s workforce needs older workers, as demographic pressures mean we’re running out of workers and businesses benefit from the experience Boomers bring.

Housing policy is now retirement policy, because the pension system only works when retirees own their home, making affordability a looming national challenge.

Currently, many Australians are focused on headlines about migration, population surges, rental shortages, and rising living costs.

But beneath those noisy narratives sits a far more consequential demographic shift, one unfolding so quietly that many haven’t yet recognised its true power.

It’s the Great Unretirement.

By 2029, every Baby Boomer, Australia’s largest, most influential and wealthiest generation, will have reached the traditional retirement age of 65.

Yet over half a million of them will still be working.

And within a few years, that number could climb toward one million.

Not because they’re stubborn. Not because they're ignoring the playbook handed down from their parents.

But because the meaning of retirement has fundamentally changed, and with it, the entire structure of Australia’s economy.

Demographer Simon Kuestenmacher summed it up beautifully when he said:

“We constantly need to rethink our stereotypes about when we retire, who retires, and what we do in retirement.”

That’s the heart of it. Retirement is no longer an event. It’s a transition. A spectrum.

In many cases, a slow slide rather than a clean break.

And the consequences - economic, financial, psychological, and social- are enormous.

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Why the old retirement model no longer works

The traditional idea of retirement was built for another Australia entirely.

Jobs were physical.
Life expectancy was much shorter.
The pension was designed for people who often didn’t reach 65.
Superannuation didn’t exist until 1992.

In those days, a 65-year-old was considered old. Their bodies were worn out, and stopping work wasn’t just a perk; it was a necessity.

But as Simon explained in our latest Demographics Decoded podcast episode:

“As we moved from industrial and farming work to knowledge jobs, it became much easier for people to keep working into their 60s and 70s.”

A 70-year-old bricklayer and a 70-year-old accountant have very different capacities.

Things have changed, and our economy is increasingly rewarding the latter, and that’s changing everything.

Boomers don’t see retirement as a reward; they see it as a loss

One of the least discussed truths about retirement is its psychological impact.

Earlier generations gained identity from family and community.

Boomers, in contrast, often gain identity from their work: their achievements, their networks, their influence, their position in the pecking order and their role in decision-making.

Note: So when someone says, “You’re retired now,” what many Boomers hear is: “You’re no longer needed. You’re less relevant.”

Simon pointed out:

“For Baby Boomer men in particular, retirement can feel like a downgrade in status.”

That’s why Boomers increasingly choose scaling back over stepping away.

They want flexibility, purpose, social engagement, cash flow, mental stimulation and most importantly… continued relevance

This is a key insight for business owners and employers...

If you want wisdom, stability, perspective, and mentorship in your workforce, Boomers are a demographic asset, not a liability.

The money problem: asset rich and cash flow poor

Let’s address the financial elephant in the room.

Yes, Boomers own an extraordinary amount of housing wealth.

But no, that doesn’t mean they can actually retire comfortably.

Superannuation balances for the average Boomer are far lower than the public assumes, because super didn’t exist for the first decades of their working lives, early super contributions were tiny compared to today’s levels, and many spent their higher-earning years before compulsory super hit meaningful levels.

Simon explained it well:

“It will take until the mid-2030s before someone retires having paid into super for their whole working life.”

This means today’s 65–75-year-olds often have a valuable home and some savings, but not enough super to replace a full-time wage

And living solely off the aged pension is a recipe for hardship.

As you and I often discuss, Boomers are frequently asset rich but income poor. A $2 million home doesn’t buy groceries.

Which leads to another problem…

Why downsizing doesn’t work anymore

For decades, the “retirement plan” for many Australians was simple:

Sell the family home, buy something smaller, pocket the difference and live comfortably.

But today, that plan breaks down for several reasons:

1. The tax hit is too big

Stamp duty on your new purchase can vaporise $150,000–$250,000 of the proceeds.

2. The right downsizer stock doesn’t exist

Middle-ring suburbs are dominated by family homes.

There are few single-level townhouses or well-located family size apartments suitable for older Australians.

3. Emotionally, it’s incredibly difficult

Selling an asset that has only ever gone up in value feels wrong.

Boomers fear missing out on future growth.

4. Community ties matter more as we age

Walking distances, local shops and familiar faces matter for mental wellbeing.

Simon described the classic scenario:

“You probably live next to an elderly widow sitting on a $2 million property while living off the pension. Selling just isn’t in her psychology.”

This is why I've long advocated for a last-move stamp duty concession.

It would free up family housing stock at scale while helping retirees unlock capital for a dignified later life.

A win-win for generations.

Two Australias are emerging

The Great Unretirement is exposing a widening divide:

1. The Boomers with choice

These Australians:

Worked in professional roles
Built businesses
Accumulated super
Own their home outright
Can choose how and when they work

These are the people posting travel photos, joining cycling clubs, spending winters in Europe, and cruising the Mediterranean.

2. The Boomers with no choice

These Australians:

Worked in lower-paid, physically demanding roles
Have limited savings
Often rent
Will have to work into their late 60s or 70s

Simon didn’t sugar-coat it:

“There will be more people forced financially to extend their working life. This group will grow.”

This divide is not just about money.

It will shape health outcomes, housing needs, retirement patterns, intergenerational wealth, social cohesion, government spending and taxation policy

And if nothing changes, it will pass inequality down the generations.

Housing is the keystone of retirement policy

Fact is...Australia’s retirement system only works if people own their homes.

A renter in retirement almost always ends up in financial distress.

Simon warned:

“The pension will never be enough to cover rent. Housing costs in retirement are becoming a major fiscal problem.”

This means that today’s declining homeownership rates for younger generations, rising rents, poor housing supply and lack of downsizer options are more just “housing issues”.

They are looming retirement crisis for future generations.

Why Australia actually needs older workers

There's another twist - Australia doesn’t just have an ageing population It has a shrinking workforce relative to economic demand.

Fewer young people are entering the labour market.

We don’t have enough skilled migration to fill the gap. And the service economy requires far more specialised roles than before.

As Simon put it bluntly:

“We will run out of workers.”

This is not some distant forecast, it's happening now.

According to Simon, the solution is...

Older workers
Higher participation rates
More flexible work
Smarter education pathways
Automation and AI
And better retention of experienced staff

A workforce with a wider age span is a strategic advantage. Younger employees bring innovation. Older workers bring perspective.

Simon explained:

“If you have a team with a vast age range, you get more perspectives. That’s extremely helpful.”

He believes the real challenge is organisational design - how do companies create upward mobility when senior leaders don’t retire at 65?

Simon suggests we will need advisory roles, consulting pathways, mentorship structures and a “Councils of elders”.

He sees this as a fascinating opportunity for innovation.

Retirement has become a slow fade, not a stop

The days of the "gold-watch retirement" are gone.

The modern retirement looks like:

Downshifting to three days a week
Then two days
Taking on a few projects
Consulting ad hoc
Periodic travel
Semi-retirement for years

Simon suggests many people will accidentally retire, only realising it months after their last job.

Note: This shift even affects super funds, which must now deal with people who are contributing and withdrawing at the same time.

Small behavioural changes at the individual level ripple out across entire sectors.

Will the Great Unretirement lead to freedom or inequality?

For some Australians, working longer will extend purpose, wealth, and wellbeing.

For others, it will represent hardship, strain, and reduced quality of life.

Whether the Great Unretirement becomes a positive evolution or a social fracture depends on:

How we structure taxation
How we address housing affordability
How we support ageing workers
How we design cities
How superannuation evolves
How we rethink retirement altogether

As I see it, the Great Unretirement is a transition phase. One that reveals where Australia is headed, unless we make thoughtful, strategic changes today.

Understanding these trends gives investors, business owners, and families a powerful advantage.

Demographics doesn’t tell us everything about the future. but it does set the direction of travel.

And as Simon reminds us each week, demographics is Australia’s crystal ball, if you’re willing to look closely.