A worrying reality has emerged for hundreds of thousands of Australians as they edge close to the normal retirement age. While people have historically hung up their work boots in their mid-60s, new research has revealed how many will have to push those plans back.

Finder discovered 16 per cent of Australians have delayed or come out of retirement in the past two years due to the current cost-of-living crisis. Sydney resident Diane Benham is one of those people and she told Yahoo Finance she thought she would be retired by now.

“Delaying retirement wasn't originally in my plans, but with expenses on the rise, contemplating life without a steady income is concerning, so I've opted to postpone retirement,” the 70-year-old building manager said.

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While she's only working 20 hours a week, she said she would far rather be enjoying her twilight years.

But with inflation pushing up the price of most essentials, she feels it's all but impossible to stop working.

“Every trip to the shops seems to cost more,” Benham said.

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“Maintaining two cars is a strain; we might have to downsize to one. While we're not considering leaving our current house and location for the security it provides, the thought of leaving Sydney crosses our minds.

“However, any move involves significant expenses, and as we grow older, having a financial safety net becomes more and more crucial.”

More than half of the people who have delayed or come out of retirement told Finder that it was due to financial pressures.

Based on their calculations, close to 805,000 Aussies didn't have enough funds in their super and other investments to stop work or remain retired.

Crisis slowly unfolding for Aussies

Finder's superannuation expert, Pascale Helyar-Moray, has expressed concerns that retirement in a person's 60s has become a luxury rather than the norm.

“There’s a growing retirement savings crisis in Australia," she said.

"Australians dedicate much of their lives to working hard, often dreaming of the 'golden years' of retirement, but for many, stepping back simply isn’t a viable option.”

The situation is particularly difficult for women, who earn less and may have taken time off work to have children.