Navigating Change for a Dignified Retirement

This blogs explores how a focus on quality of life is critical to realising dignity in retirement and this necessarily involves navigating the inevitable changes life holds for us all. In fact, helping navigate change with confidence is the core value most of us really seek from financial service providers.

Restated purpose of superannuation

The prime purpose of superannuation has again been in the news over the last couple of weeks with the Government’s announcement of the latest adjustments to super tax concessions.

Despite the dropping of the ‘unrealised gains’ requirement and the addition of indexing, the $3million 30% threshold is still in place and a new 40% tax rate will now be applied to funds with a balance of over $10 million.

Clearly the Government wants to continue to emphasise their belief that the prime purpose of superannuation (as outlined in The Superannuation (Objective) Bill of 2023) is to: “preserve savings to deliver income for a dignified retirement, alongside government support, in an equitable and sustainable way”.

That is, $3 million is more than sufficient for Australians to achieve a ‘dignified retirement’ and funds in excess of $10 million are likely being used for other purposes.

So, what are the underpinning elements of a dignified retirement?

In our Blog ‘The dignity gap in retirement’ posted last year we identified six key driving forces: -

1. Financial health

2. Personal health

3. Connection

4. Purpose and meaning

5. Capability and control

6. Life satisfaction

We positioned these in the following dynamic ‘Hub and spoke’ diagram.

Drivers of dignity in retirement

As dignity in retirement has been restated as the primary purpose of superannuation, we argued that the focus of advisors now needs to shift to include how to enhance client quality of life through maximising their tangible and less tangible assets and liabilities.

Financial advice as change coaching

This expanded adviser mandate arguably also involves supporting clients in anticipating and proactively managing the many ups and downs, issues and opportunities likely to arise during their work, family and retirement lives.

Many of these changes have financial implications. For example, market corrections, getting married, having twins, receiving an inheritance, being made redundant, divorce, looking after aging parents with early onset dementia, being diagnosed with major health issues and even in some areas being flooded or burnt out. In fact, all of the six ‘dignity’ related elements listed above are subject to change.

Specific change challenges in transition into retirement

‘Pretirement’ is now a term being used to describe the period of transition between a full-time career and full retirement. It can involve some significant career shifts and associated emotional ups and downs which in turn can flow through into full retirement, as illustrated in the following diagram.

Possible emotional ups and downs in 'Pretirement' and Retirement

*Adapted and extended from RC Atchley, The Sociology of Retirement (1976).

Research into the factors that contribute to a dignified well-adjusted retirement clearly identify that conditions of exit from full-time employment (e.g. perceived choice in the decision to retire, ease of difficulty in making the decision to exit and a gradual versus abrupt entry into retirement) can have a significant impact on financial and physical health, connection, purpose/ meaning, sense of control and overall life satisfaction.

We believe it’s in this phase of ‘Pretirement’ that advisors can have a vital role in helping clients grapple with change questions such as:

1. "I’m really struggling with the increasing demands of my role. What would be the longer-term financial impact if I tried to negotiate tapering down into a part-time project or advisory role with a likely drop in my income?"

2. "I’m thinking about giving up my current job and converting a special interest/hobby into a small business. Is this a good idea?"

3. "I’ve just been told I’ve been made redundant which I believe is shortsighted, inappropriate and totally unexpected. How is this going to impact my super and retirement?"

4. "We are wanting to move out of the city and have a sea/tree change. My organisation says I can work remotely as a technical advisor with reduced travel commitments, but on a reduced salary. Are we in a financial position to do this?"

5. "Our eldest son who has recently married has asked if we can go guarantor for a house loan by offering our house as security. In our situation is this a feasible idea?"

6. "My daughter has recently experienced an acrimonious divorce and needs assistance securing housing and financial security. How much can I afford to help her and grandchild without seriously compromising my own retirement preparedness?"

7. "I have just received a poor health diagnosis which has changed my perspective on my life goals, ability to work and afford ensuing medical costs? How do I best pivot from here?"

8. "I have found myself squarely in the sandwich generation with competing priorities for helping my ageing parents, giving my kids a head start in life and ensuring my own comfortable retirement. How can I balance these priorities with the limited resources I have available?"

Some practical tips for helping manage change issues

Change is often exciting when we initiate it but can be threatening when imposed upon us. It often involves combinations of gains and losses. Gains need to be celebrated and losses acknowledged.

In your practice there are likely to be some clients who thrive on change and are always wanting to tinker with their investment portfolios, change their employers or even where they live. At times you may need to initially actively listen and then temper their enthusiasm by encouraging them to think through the implications of their ideas, using a series of well framed questions.

At the other end of the change continuum are clients who find change difficult and draining. (Mark Twain once proclaimed, “I’m all for progress but it’s the change I don’t like”!). Many of these clients are reluctant to change until they are forced to do so. For example, delaying having a hip or knee replacement even though their mobility may be severely restricted and as a result they are becoming socially isolated and depressed.

NB: Encouraging clients to name their possible losses in the change process and openly talking about them is often part of the ‘letting go’ and acceptance process, as is the re-statement of benefits.  Below are some practical tips for helping clients embrace change:

Tip 1 Summarise what’s happening now and how they’re feeling about it

Example: “I understand you are becoming increasingly stressed about bills and expenses pilling up and you just don’t have enough income to pay them.”

Tip 2 Explore why change is now needed and the benefits of making a change and the risks of not addressing what’s happening

Example: “So you’ve been trying to make ends meet by juggling payments using your credit card but are now finding you are unable to make minimum re-payments on time. If something doesn’t change you might need to consider selling your car.”

Tip 3 Identify what factors may be preventing/blocking change

Example: “Are there any expenses you’ve listed that could be eliminated or reduced, like high interest payments on your credit card, if you had more income perhaps by applying for extra aged care benefits?"

Tip 4 Help them identify and map the factors supporting making a change and those holding change back (see change force framework example below)

Clients who learn and understand by seeing things, often find diagrams very helpful. For those who like to work through issues by touching and doing, getting them to draw in the lengths/importance of the driving and resisting factors can help them achieve more ownership of the change process.

Tip 5 Agree what change driving and resisting forces can be increased or decreased when and by whom.

Example: “I could look up if you might be eligible for some extra aged care support benefits and or review your Super investment settings (growth ‘v’ income) to lift your monthly income.”

Tip 6 Acknowledge any possible losses involved in the change process

Example: “I guess not being able to go out so often with friends for casual coffees and meals will be a bit of a loss unless we can brainstorm some less costly ways of connecting.

Do you anticipate any other losses you will need to work through?”

Tip 7 Anticipate and celebrate expected gains

Example: “However the good news is, once we can balance your budget, you’ll be free of all the stress and anxiety which has been constantly waking you up at nights over the last few months.”

Financial change force example

Conclusions

Superannuation’s purpose has been reaffirmed by the Government as helping Australians achieve a “dignified retirement” i.e. one that sustains both financial independence and personal wellbeing. But as the concept of dignity expands beyond simple dollar thresholds, the role of financial advisers and superfunds must also evolve.

True dignity in retirement is shaped by six interlinked dimensions — financial health, personal health, connection, purpose, capability, and life satisfaction. Each of these is dynamic, vulnerable to life’s inevitable changes, and influenced by both planned and unplanned events throughout a client’s working life, 'pretirement', and beyond.

In this shifting landscape, advisers are not just financial experts — they are change coaches. They help clients navigate transitions like redundancy, health diagnoses, career pivots, caring responsibilities, and family financial pressures. Each decision carries emotional weight as well as financial implications, and clients often need support not just to make the right choices, but to process and adapt to change itself.

Adopting a coaching mindset means helping clients frame what’s happening, explore the reasons for change, identify barriers, weigh risks and rewards, and recognise both the losses and gains inherent in any transition. Through structured reflection and empathetic questioning, advisers can help clients build resilience, regain control, and make confident decisions aligned with their evolving goals and values.

The vision of a dignified retirement can no longer be delivered through financial planning alone. It demands a holistic approach that integrates emotional, behavioural, and social dimensions of change.

Mapping client emotions is key to building trust in financial planning. Clients experience various emotional responses, and understanding these, along with their money mindset shaped by past experiences, is crucial. This necessitates an approach that considers emotional and behavioural aspects to foster strong professional-client relationships. By recognising and addressing client emotions, financial advisers and superfunds can transform apprehension into trust, leading to more effective and personalised financial guidance and advice.

By embracing the role of change coach, advisers and superfunds can:

• Help solve clients the ‘jobs to be done’ they prioritise and enhance the perceived value of the advice delivered.

• Help clients transform uncertainty into opportunity as they move through life’s transitions.

• Help clients embrace and adhere to a financial plan that meets their best interests.

• Strengthen client trust through deeper, more human conversations.

• Support better long-term outcomes by addressing both financial and non-financial factors.

Ultimately, the measure of success for both superannuation and advice is not simply the balance at retirement, but the quality of life it sustains. Advisers and superfunds who guide clients and members through change with empathy, structure, and purpose are not only securing financial futures — they are helping Australians retire with dignity, confidence, and a sense of fulfilment.

 Authors

In this ongoing series of blogs, we will further unpack our practical ideas and tips to help all Australians achieve a dignified retirement. This will include how to engage, motivate and empower individuals to act in their best financial (and life) interests.

Humphrey Armstrong is a registered psychologist and consultant to MYMAVINS with decades of experience helping Australians navigate their transition to retirement and journey successfully through their third act.

Tai Rotem is a consulting partner at MYMAVINS with several decades experience in financial consumer, public health, social and behavioural change research.

Reach out to him at Tai@mymavins.com.au