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2018

Prudential is the first financial institution to scrap retirement age

1,100 employees given the opportunity to enjoy extended careers

 

Prudential is the first financial institution to scrap retirement age

Singapore, 23 October 2018 – As life expectancy in Singapore continues to rise, Prudential Singapore (Prudential) is giving its employees the option to work beyond the statutory retirement age of 62.


With the removal of a retirement age, Prudential’s 1,100 employees can look forward to having extended careers, so they can fulfil their personal and financial aspirations.

Prudential Singapore’s CEO Wilf Blackburn said the company recognised that retirement at 62 may no longer make sense for an ageing population that has an average lifespan of 83.1 years and which is edging towards 100.

“If we stop work at 62, we are looking at nearly 40 years of retirement if we live to 100. Such a long retirement period may pose financial challenges should you outlive your savings. A prolonged period of inactivity may also lead to health and social problems.

“With this in mind, we decided to scrap the retirement age so that our employees can continue to work in Prudential for as long as they are able to perform their jobs well. We want to empower them to decide when they want to retire, or if they wish to retire at all, rather than specify a work expiry date,” said Mr Blackburn.

Prudential’s new retirement policy, which came into effect on 1 October 2018, was introduced on the back of the insurer’s Ready for 100 report which explores the readiness and aspirations of Singapore residents to live to 100.

The report revealed that one in two residents (55 per cent) were not financially ready to live to 100 years of age. This is despite Singaporeans being ardent savers and having strong safety nets in the country’s Central Provident Fund (CPF).

Additionally, the report showed that most Singapore residents in fact do want to continue working. Only four per cent of the 1,214 respondents surveyed indicated they want to retire as soon as possible, while 64 per cent of the group aged 55-64 said they still enjoy their work.

Currently, Prudential has six employees aged 62 and above who are eligible for re-employment in the next five years. With the lifting of the retirement age, they can stay on in their jobs and be entitled to the same benefits, including medical, as all employees while drawing the same salary as before. They will still receive a retirement payout any time they choose to leave their jobs.

Among them is Ms Noreen Wee, 62, a lead writer in policy contracts, who has been working with Prudential for 18 years and was set to retire in December this year.

Ms Wee said: “I’m pleasantly surprised to hear about the change in the retirement policy as I want to stay on and continue working in Prudential for as long as I can. What makes it better is that I won’t get a pay cut and will continue to enjoy the same employee benefits as before.

“To retire at 62 is really too young as I’m still healthy and know that I can still contribute to the company. More importantly, I want to have the choice to retire at any age and not be forced to stop working simply because I’m 62. After all, age is but a number.”

Prudential’s latest move to eliminate the retirement age is in line with Singapore’s ambition to leverage its rapidly-ageing workforce. In May this year, Manpower Minister Josephine Teo announced the formation of a new work group with high-level representatives from the unions, businesses and the government to address older workers' retirement and re-employment age, and review the longer-term relevance of these policies.1

Mr Blackburn said, “There is a lot that businesses can gain by tapping on the experience and knowledge of the more mature employees. At Prudential, we see this group of employees as valuable assets and are committed to support them in extending their productive years by offering them re-skilling opportunities and flexible work schedules as we scrap the retirement age.”

 

About Prudential Assurance Company Singapore (Pte) Ltd (Prudential Singapore)

Prudential Assurance Company Singapore (Pte) Ltd is one of the top life insurance companies in Singapore, serving the financial and protection needs of the country’s citizens for 87 years. The company has an AA- Financial Strength Rating from leading credit rating agency Standard & Poor’s, with S$36.3 billion funds under management as at 31 December 2017. It delivers a suite of well-rounded product offerings in Protection, Savings and Investment through multiple distribution channels including a network of more than 4,800 financial consultants.


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Megan Fernandes
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1 “New work group on older workers to look at policies including retirement age and CPF rates”, 28 May 2018,https://www.straitstimes.com/singapore/new-work-group-on-older-workers-to-look-at-policies-including-retirement-age-and- cpf-rates