Steven Cameron, Pensions Director at Aegon, welcomes the UK government initiative to encourage people to work past 50:
“In today’s society, there’s no place for a ‘fixed retirement age’, and rightly so. Flexible working up to and beyond traditional retirement ages is becoming the new normal, and an increasing number of older workers with the prospect of a longer and healthier retirement, relish the opportunity to stay in work. This stems partly from the desire to continue on in some sort of employment to remain socially, physically or mentally active, all of which can be beneficial for health and well-being. However, financial considerations also feature as a key reason.”
Aegon research shows that only 12% of the working population are financially on track for the retirement they want, and half of the population are worried about running out of savings in retirement. As a result, over two-fifths of people have continued to work past state retirement age.
Cameron continues: “The decline of generous final salary pension schemes means there is a greater onus on individuals to put enough money aside for the retirement they aspire to. The arrival of the pension freedoms gives individuals much more flexibility regarding when to start taking an income and how much to take year on year. Working for a few more years can make a big difference to how much of a pension fund individuals can build up, and deferring when to start taking retirement income also means it’s more likely to go the distance.
“Employers can also benefit. By offering choice to their workforces, they can benefit from a diverse workforce and retain talent and expertise that in days gone by were often lost.”