Half of individuals (50 per cent) retiring this year are considering working past the state pension age, research from Prudential showed.
The provider, which polled 9,896 non-retired UK adults aged 45 plus, including 1,000 planning to retire in 2018, said this is the sixth consecutive year where half of those retiring would be happy to keep working if it meant guaranteeing a greater retirement income.
More than a quarter (26 per cent) of those planning to delay their retirement would like to reduce their hours, and work part-time with their current employer, the research revealed.
Only one in seven (14 per cent) of respondents would like to continue full time in their current role, and a fifth (19 per cent) would like try to earn a living from a hobby or start their own business.
Around one in 12 (8 per cent) of those scheduled to retire in 2018 have postponed their plans because they cannot afford to retire.
Nearly half (47 per cent) of these individuals put this down to the cost of day-to-day living, which means their retirement income won't be sufficient.
The research also found that the decision to put off retirement isn’t always a financial one.
More than half (54 per cent) of respondents who are already or are considering working past their state pension age said it is to keep their mind and body active and healthy.
More than two fifths (43 per cent) admit they simply enjoy working, while just over a quarter (26 per cent) don’t like the idea of being at home all the time.
According to Stan Russell, a retirement income expert at Prudential, the shift to pre-retirement in recent years shows that many people reaching state pension age aren’t ready to stop working.
He said: “Reducing hours, earning money from a hobby or changing jobs are all ways to wind down from working life gradually and for many to avoid boredom and maintain an active mind and body.
“However, not everyone has the luxury of choosing their retirement date due to their financial situation not allowing them to give up work and others may be forced to stop working for health reasons.
“Saving as much as possible as early possible in their career is the best way for people to ensure they are financially well-prepared for a retirement that starts when they wish, or need, it to.”
Mr Russell added that as people are increasingly treating retirement as a gradual process, regular discussions with a financial adviser can help to make sure that the individual’s retirement finances are sufficient to allow as many options as possible.
He said: “Taking advice from free impartial guidance sources such as the Pensions Advisory Service or the government’s Pension Wise service can also be useful.”
According to Steve Carlson, chartered financial planner at Cardiff-based Carlson Wealth Management, “it can be hard to go from working full-time to not working at all, as everyone needs some kind of purpose in life otherwise they can feel lost and/or bored”.
He said: “The majority of my clients are phasing in their retirement, going from full-time to part-time so they can get the work/life balance they want, which can often be a lot earlier than if they waited for the traditional ‘full retirement’.”
maria.espadinha@ft.com
