Almost 70% of UK workers plan to stay in employment past their current standard retirement age but few are financially prepared for when they do leave work.
Aviva’s Real Retirement Report research reveals that that those on a countdown to retirement (aged 55 to 64) have falling household incomes and low savings pots.
The majority of income for over 55s would be made up of state pension (23% of total income), followed by employer pension making up 16% and wages/earned income makingup 13%.
These figures suggest that people have not made adequate pension plans or savings provisions for their retirement years. The report reveals that the top reason for continuing to work is to improve financial standing (60%).
Many respondents (41%) stated that they would continue working for their current employer beyond their official retirement age if possible, and of those, 24% would opt for ‘part-tirement’, that part retirement, part working. However 5% say that this is not an option due to the enforced retirement date at their current workplace.
Clive Bolton, ‘at-retirement’ director, Aviva Life, commented: “Government proposals mean that the state retirement age is set to increase over the next few years, but it appears that many UK adults already see themselves working well past traditional retirement age.
“Pre-retirees generally choose to use the last few years of full-time work to make as much provision for their retirement as possible. However, this research shows that salaries can – and do – fall immediately prior to retirement often due to circumstances beyond peoples’ control, so a long-term approach to pension planning is crucial.”
Read more on pensions