Why do people retire? It’s a fairly simple question with what many would suppose is a fairly simple answer. Employees reach a certain age, achieve specific milestones, become eligible for employer or government retirement benefits and decide to call it quits. But as Baby Boomers start retiring, understanding the nuances of that question and answer becomes more important for employers, partly because the role of employers has changed and partly because the traditional model of full retirement at a fixed date is on the wane. How can organizations manage the exit of employees in critical roles? How can they help employees retire when the time is right and without regret?

A number of factors influence workers’ decisions to retire: Age, health, family circumstances and employer incentives hold more or less sway with older and younger workers. Research is scarce on the thought processes and motivations leading up to retirement.1

To better understand the dynamics of workers’ retirement decisions, we invited a randomly selected sample of OneExchange users who were 65 or older and receiving employer-provided retiree medical benefits to tell us more about their decision to retire and its aftermath.2

Survey highlights

  • We asked 4,049 retirees aged 65 or older to think back to when they retired — about their motivations at the time versus how they feel about retirement now.
  • For most people, the decision to retire was prompted by both personal and professional circumstances.
  • More than a quarter of surveyed retirees cited employer incentives — such as eligibility for retirement and retiree health benefits — as their main motivation to retire. Among more recent retirees, however, the relative importance of employer programs has declined, while workplace environment and eligibility for Social Security and Medicare play larger roles.
  • As employer retirement and health care benefits become less generous (and early retirement incentives become rarer), employers wield less direct influence over their employees’ retirement decisions.
  • Retirees who based their retirement decision on eligibility for employer benefits or other employer incentives seemed to be enjoying retirement more than retirees with other motivations, and they were less likely to regret their decision to retire. Conversely, those who felt “driven away” by work pressures were more likely to be burdened by financial worries, have retirement come as a shock and regret their decision.
  • As more people delay retirement, the work environment is assuming a larger role in retirement decisions, with workers’ feelings about their jobs becoming increasingly instrumental. One in five retirees cited disengagement with their job as a key reason for deciding to retire. This is signaling that changing the work environment could open up alternative ways for employers to influence employees’ retirement timing, counterbalancing the receding impact of direct employer incentives.

Motivations to retire and the role of employer benefits

The survey asked respondents to rate the importance of 20 reasons to retire, which were then categorized into six broader retirement motives (Figure 1).

Figure 1. Most retirees cited personal reasons and employer incentives as key retirement motives

Source: Willis Towers Watson survey

Personal circumstances were the top retirement driver. Almost two in three retirees reported that personal circumstances — ranging from health issues to a desire for more leisure time — were quite or extremely important to their retirement decision. Employer incentives were the second most important influence on retirement. More than half of retirees cited employer retirement plans and other employer incentives as key factors in their decision to retire. The overwhelming majority of those who gave reasons related to their working environment said that feeling disengaged from their employer, their job or both played a pivotal role in their retirement decision.

We ranked the top 10 reasons for retiring based on the percentage of respondents who rated them “extremely important” (Figure 2). The leading five reasons related to employer incentives or personal circumstances, while the remaining five reasons pertained to eligibility for Social Security, dissatisfaction with the work environment (such as no longer feeling valued by the employer and pressure from colleagues or managers), family circumstances (partner’s or spouse’s retirement) and stock market performance.

Figure 2. Pension eligibility is top reason for retirement

Note: Percentage based on those who rated the factor as “extremely important.”
Source: Willis Towers Watson survey

Health and wealth also affected how workers felt about working versus retiring. As expected, a larger proportion of workers in good health who were financially better off identified personal motives as an extremely important reason to retire.3 Respondents who cited inability to do the job as a major factor in their retirement decision were more likely to have lower incomes, suggesting their job may have been more physically demanding or they may have been in poor health. Twelve percent of those in “poor” or “fair” health selected capacity to do the job as a key retirement motive, compared with only 4% of those in excellent health.

Similarly, while 10% of low-income workers said work capacity was an extremely important motive for retirement, only 4% of high-income workers agreed. Qualifying for Social Security and Medicare was a less powerful retirement driver for wealthier retirees.

The growing role of the workplace as a retirement trigger

The survey respondents retired across almost 35 years — from the 1980s through 2014 — thus allowing for an analysis of changing retirement motives. As Figure 3 shows, older retirees gave different reasons for retiring than younger retirees. A substantially larger proportion of those who retired in the 1980s cited employer programs (retirement benefits and other incentives) as a major motive to retire, compared with those who retired more recently. Younger retirees were also more likely than older ones to identify eligibility for government programs as an extremely powerful motive to retire.

Figure 3. Changing reasons for retirement, 1980 – 2014
Reason for retiring 1980 – 1989 1990 – 1999 2000 – 2009 2010 – 2014 Change
Personal (health, desire for leisure and enjoyment) 25% 29% 38% 39% +14
Employer (retirement incentives) 41% 40% 34% 27% -14
Normative (eligibility for government programs) 6% 10% 14% 18% +12
Workplace (dismissive corporate culture, disengagement, not feeling valued) 10% 15% 14% 19% +9
Family (spouse’s retirement or health of family member) 10% 10% 12% 11% +1
Capacity (ability to perform job) 3% 6% 7% 8% +5

Source: Willis Towers Watson survey

Perhaps not surprisingly, as retiree health and retirement programs have become less generous, they have less influence on when workers retire. Meanwhile, personal reasons, eligibility for government programs and workplace factors — most often disengagement — have gained greater influence. These factors could become increasingly important in the future, as retirement age continues to rise4 and technological advances accelerate, potentially rendering some jobs and skills obsolete.

In a series of small focus groups in 2013, the Society of Actuaries (SOA) found that more workers based their decision to retire on health issues, workplace challenges or family caregiving than on a desire to pursue a hobby or start a business.5 The SOA concluded that most retirees felt compelled to retire, rather than retiring to pursue other opportunities or when their finances were in order. Most of those they interviewed seemed to have felt, one way or another, “pushed” out of the workplace.

We also asked survey respondents how strongly they agreed or disagreed with the statement “I was pushed into retirement.” Almost one in four agreed or strongly agreed that they were pushed out of the workplace (Figure 4). Retirees who felt pushed into retirement were more likely to have been motivated by an uncomfortable workplace or to have responded to employer incentives.

Figure 4. Almost one-quarter of retirees felt pushed into retirement

Almost one-quarter of retirees felt pushed into retirement

Source: Willis Towers Watson survey

Reactions to retirement

Being retired is not a bed of roses for everyone. Almost one in 10 retirees regretted their decision to retire, and 44% of those with regrets said they would like to return to work. Regret was less common for those who retired for personal reasons or in response to employer incentives, but the incidence rises to 17% among those who retired because of job dissatisfaction. In fact, including retirees who felt highly disengaged at work and/or not valued by their employer pushes the percentage with regrets to almost 20%. This is likely to become more problematic in the future, as more employees continue working because they can’t afford to retire, despite feeling disappointed and less engaged with their jobs.

The overwhelming majority of retirees reported having more leisure time: 55% spent a lot more time pursuing other activities, and 43% spent more time with family and friends. However, almost one in 10 retirees cited financial concerns and roughly one in eight believed they had retired too soon. Eight percent of retirees felt shocked by retirement or had trouble with the lack of routine or other adjustment difficulties.

Retirees’ experiences were strongly influenced by their reasons for retiring. Those who retired of their own volition had fewer negative experiences. Those who retired because of dissatisfaction with their workplace had more negative experiences: 31% felt they had retired too soon, 24% had difficulty adjusting and 23% worried about whether they could afford retirement.


This article examined key motivations for retirement among a subset of U.S. retirees who have employer retiree medical benefits, most of whom had worked for large employers. Personal motives factored strongly in their decisions to retire, although employer retirement programs and other employer incentives also played key roles. More than a quarter cited employer incentives as their main motive for retiring. As retiree health and retirement benefits have become less generous over time, however, employee benefits have less influence on retirement decisions, thus becoming less effective workforce planning tools.

Meanwhile, eligibility for government programs and workplace factors are becoming more central to retirement decisions. A sizable number of workers felt pushed into retirement, and this feeling was more prevalent among those whose retirement was motivated by negative workplace factors, such as not feeling valued or being disengaged. Although relatively few employees felt driven out of the workforce by workplace pressure, those who did were also more likely to regret their retirement decision, to feel shocked by retirement and to worry about whether they could afford it.

Moreover, employees are retiring later, and as the number of workers older than 60 has risen, so has the number of retirees who say their work environment affected their decision to retire and they felt pushed out of the workforce. Other Willis Towers Watson research has also found that the number of U.S. employees postponing retirement is rising, with nearly one-third expecting to work to age 70 or beyond. Those who expect to remain on the job the longest tend to be more stressed and disengaged from their work, thus raising concerns about the impact of later retirement on productivity.6 Together with the greater potential for workplace tensions implied by our survey results, this suggests some challenges ahead for employers. In this environment, understanding the motivations for retirement becomes crucial.

About the survey

There were 4,049 retirees who volunteered for the survey. With an average household income of $81,907, these respondents had higher incomes than the typical U.S. retiree (the national averages are $53,500 for those over 65 and $63,900 for those between 65 and 74). Moreover, these retirees enjoyed employer-based retiree medical insurance, which most U.S. retirees do not.

Figure 5. Summary statistics
65 – 69 35%
70 – 74 31%
75 – 79 20%
80 – 84 10%
85 or older 4%
Employment status
Retired 90%
Semiretired (working part time/occasionally) 8%
Employed full time 2%
Female 27%
Male 73%
Health status
Excellent 16%
Very good 47%
Good 30%
Fair or poor 7%
Longest career occupation
Senior manager 10%
Manager 42%
Professional 35%
Other 13%

Source: Willis Towers Watson survey


1. See Melissa A. Z. Knoll, Behavioral and Psychological Aspects of the Retirement Decision, Social Security Bulletin, Vol. 71, No. 4, 2011. Accessed April 27, 2015.

2. Towers Watson’s OneExchange offers employers both private and public exchange-based health insurance options for their full- and part-time workers, and retirees.

3. Forty-three percent of those in excellent health identified personal reasons as an extremely important retirement driver, compared with only 26% of those in fair or poor health. Thirty-eight percent of high-income respondents said personal reasons were extremely important to their retirement decision versus 25% of lower-income respondents.

4. Our sample of retirees captures an increment in retirement ages. Most of those who retired between 1980 and 1990 were in their 50s or early 60s, while those who retired between 2010 and 2014 were typically in their mid-60s.

6. See Billie Jean Miller and Steve Nyce, “Which Workers Are Delaying Retirement and Why?” Towers Watson Insider, September 2014. Accessed April 27, 2015.