Later LifeJun 10 2019

Two in five plan to retire before 65

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Two in five plan to retire before 65

Almost half of savers are planning to retire before they reach the age of 65, according to research.

Workplace savings business Punter Southall Aspire surveyed 177 individuals last month (May 2019) and found that 43 per cent planned to retire before they turn 65 and another 17 per cent before the age of 70.

Of those who have already retired, two-thirds had stopped work completely and one in five were still working on a part-time or casual basis.

Peter Selby, managing director of retail advice at Punter Southall Aspire, said the figures showed a growing trend for people to continue working into retirement, whether it is through necessity or boredom.

He said: "Once upon a time, you hit 'retirement age' and that was it, you stopped work. Some people even retired early in their 50s. Most expected to enjoy a few golden years in retirement and be able to fund that time. 

"However, our survey reveals a changing picture of retirement that mirrors the broader UK outlook and underlines the growing need for people to save for their retirement."

He added: "Many people hitting retirement today, who may be living well into their 80s and 90s, won’t necessarily have sufficient money to stop work at 65, so more and more are working way beyond state pension age. 

"Our survey suggests even if people have built up an adequate pension pot, they don’t necessarily want to stop work."

In November the Office for National Statistics (ONS) projected that more than a quarter of UK residents will be aged 65 years or over within the next 50 years.

Mr Selby said: "Some people feel at the peak of their career at 65, and still have a lot to contribute. They are still healthy, so even if they want to slow down, they might still have plenty of energy and find retirement a drag."

Another recent survey from Canada Life, which polled 1,002 full and part-time employees in April 2019, found nearly three quarters (71 per cent) of UK employees, equivalent to 23m people, were set to work past age 65, up from 61 per cent in 2005.

Of these, two in five (37 per cent) believed they would reach 75 before they retire.

A third of those who intended to work past 65 admitted they had to continue to earn a wage because their pension savings were insufficient.

Paul McGlone, president of the Society of Pension Professionals, said: "As each generation lives longer it’s inevitable that they will need to work longer to fund their retirement.

"Combine that with the move from final salary schemes to less generous defined contribution schemes, individuals will need to work even longer in order to save enough."