News: Singapore to raise workers' retirement and re-employment ages

Compensation & Benefits

Singapore to raise workers' retirement and re-employment ages

Singapore's move to extend the retirement age in 2026 is expected to impact the retirement plans and financial security of many.
Singapore to raise workers' retirement and re-employment ages

SINGAPORE – Singapore is set to incrementally increase its retirement and re-employment ages over the coming years, with the goal of reaching 65 and 70 respectively by 2030.

The first stage of these changes will take effect in 2026, raising the retirement age to 64 and the re-employment age to 69, as announced by Minister of State for Manpower Gan Siow Huang.

How the new retirement and re-employment policies will affect Singaporeans

This adjustment means that from 2026, employers will be obligated to offer re-employment to eligible Singaporean citizens and permanent residents who meet specific performance and health criteria.

To be eligible, those who joined a company after the age of 55 must have accumulated at least two years of service with their current employer. Re-employment contracts will be for a minimum duration of one year and will be renewable on an annual basis.

“Singapore's upcoming rise in the retirement age to 64 in 2026 underscores the importance of proactive retirement planning. With a longer working life, residents have a greater opportunity to accumulate savings and ensure financial security in their later years,” said Ser-Jin Phua, one of Singapore’s top leaders in financial Planning, Business Risks Management, and Health Insurance.

“This shift necessitates early assessment of retirement needs and potential adjustments to savings plans. By taking advantage of government initiatives and actively managing finances, Singaporeans can approach their golden years with greater peace of mind and enjoy a well-deserved retirement,” he added.

These policy adjustments, initially announced in 2019, have been designed to allow for a smooth transition for both employers and employees.

The first increase in the retirement age, from 62 to 63, was implemented in July 2022 and has already seen high re-employment rates among senior workers.

Proactive planning key to smooth adjustment

The government is encouraging companies to proactively plan for the upcoming changes, suggesting they may need to adapt their manpower and upskilling strategies to retain experienced older workers who wish to continue contributing to the workforce.

“Raising the retirement and re-employment ages would create more opportunities for our seniors to participate more and for longer in the labour market. This also enables businesses to tap into a wider workforce,” Ang Tze Phern, partner for the Employment Group at Rajah & Tann, told the Singapore Business Review.

It's important to note that these adjustments will not affect the ages at which individuals can withdraw or receive payouts from their Central Provident Fund (CPF) accounts.

The gradual increase in retirement and re-employment ages is part of a broader government initiative to address the needs of an aging population while ensuring the continued vitality of the economy.

By enabling older workers to remain active in the workforce for longer, Singapore aims to tap into their valuable skills and experience, fostering a more inclusive and productive work environment for all.

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Topics: Compensation & Benefits, Economy & Policy

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