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Two-thirds to continue working after 65, finds survey

Cherry Reynard
Written By:
Cherry Reynard
Posted:
Updated:
29/08/2014

Far from wanting to kick back and relax, two-thirds of employees approaching retirement intend to continue doing some form of paid or voluntary work once they are in ‘retirement’, according to a new survey from wealth adviser Towry.

Two-thirds (65%) of workers aged 50+ plan to do some form of paid work during retirement, with nearly a third doing so because they enjoy working, rather than for financial reasons. A quarter of workers (26%) plan to do voluntary work in their retirement to help the local community or charities.

The findings support the view from a number of research reports that the pattern of retirement is changing. Retirement is no longer a point in time, but may be staggered, or phased. As such, some financial products that have historically been used to fund retirement, notably annuities, may have less relevance in this context.

Towry’s head of retirement planning, Andy James, said: “With people living and staying fitter for longer in retirement – in many cases well into their 80s – those who have carefully laid financial plans for their future now have the flexibility to choose whether they continue working during retirement.

“This survey has shown that many who have planned well for their retirement are keen to continue playing some part in the working world, be this in a paid or voluntary role. If you seek financial advice early, you may even be able to realise some lifelong dreams during retirement, pursuing the ultimate vocation that you always desired.”

Colin Williams, managing director of corporate benefits at Friends Life, said: “This research confirms what we had long suspected: people are planning to stage their retirement. Although the majority of people want to continue working to some extent in retirement, they need to plan ahead to ensure they can afford to reduce their hours. We analysed data and discovered salaries fall by £400 per year once workers turn 50, so people should be saving as much as they can, while they can, before their income drops.

Richard Watkins, certified financial planner at Close Brothers Asset Management, agrees: “We are no doubt seeing shifting approaches to retirement as people stay healthier for longer, but working in later life should be a choice rather than a financial necessity. In order for people to reach their goals for their retirement, whether reduced hours or volunteering, early planning is crucial and will give them their best chance of achieving them. People place the most value on security, quality of lifestyle, comfort and stability in the later years, and appropriate, tailor-made financial advice will provide the financial flexibility to support these.”