Increases in the state pension age, poor private pension provisions and people being fitter for longer have all led to a record number of 65-year-olds still in employment.
The figures, from the Institute for Fiscal Studies, showed that around 55,000 more 65-year-olds were employed in 2021 compared to the previous year, which equates to a 7% increase in men and a 9% increase in women remaining in work.
Stuart Price, Partner and Actuary at Quantum Advisory, believes the increase is primarily due to pensions, as well as a physically fitter older generation who are able to continue to work. Stuart said: “Our pension system is now a lot more flexible than it has been and allows individuals more choice as to when and how they retire. People are generally staying more physically active later in life and we’re living longer. This is a key reason why the state pension age keeps getting pushed back. Those that are able to continue to work into their late sixties and beyond are choosing to because they can. Retaining an experienced workforce is also a bonus for employers.
“On the flipside, there are those that have to continue to work because they have no choice. Many older people realise their retirement income would not cover the cost of day-to-day living. They need to wait at least until they reach state pension age. The key for those wanting to retire at a decent age, is to start saving into a private scheme as early as possible and put as much aside as is affordable. Having this retirement pot then allows for flexibility and removes the reliance on the state pension – which is likely to be delayed further in the years to come.”
Quantum Advisory specialises in pension and employee benefits services to employers, scheme trustees and members. For more information, visit www.quantumadvisory.co.uk.