We know demographics are changing. We’re living longer, quite alarmingly; the population of England is set to rise by around nine million by 20391, with almost two thirds of that increase occurring in the pension age bracket. Not so long ago, many people’s lives fell into three distinct stages – education, career and retirement. The date at which people chose to retire was usually aligned with their state retirement age; 60 for women and 65 for men. Today, retirement no longer means packing up your desk on your 60th or 65th birthday.
Today, many people are choosing to adopt a more gradual approach to retirement, working beyond their state pension age, slowly reducing the amount of time they spend at work. Some people are even choosing completely different careers to embark upon.
A widely-accepted concept referred to as ‘pretirement’ is the process of gradually reducing the number of hours worked, which generally begins in people’s 50s and can run into their 70s and beyond. Figures for the three month period December 2017 to February 2018, show that just under 1.2m people over the age of 65 were in work, and for the first time, there were more than 10m people aged over 50 in employment out of a total workforce of 32.2m1.
People choose to adopt a ‘pretirement’ approach to working for a variety of reasons, including a requirement to boost their retirement income, continuing because they enjoy the work they do, they feel they still have something to offer their workplace.
Whatever your thoughts on the type of retirement you want, financial advice will ensure that you can make the best use of your pension funds and savings, to select the best retirement income solution for your circumstances. It’s important to have the right retirement plans in place so that you can choose the path to full retirement that suits you.
1Office for National Statistics, 2016 and 2018
A pension is a long-term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.