Number of savers expecting to work past state pension age falls 14%

The number of workers expecting to work beyond state pension age has fallen by 14 per cent year-on-year to 19.8 million in 2020, according to research from Canada Life.

This is the first year that the number of people expecting to work beyond state pension age has fallen since Canada Life’s research began in 2015, with Covid-19 seemingly accelerating retirement plans.

In particular, the provider noted that health issues bought on by the virus, amid an increase in unemployment and redundancy, could be encouraging more people to stop working when they hit age 66.

Despite this, of the 19.8 million people who do plan to work into their late 60s, 16 per cent do not expect to retire until they’ve turned 75, with 42 per cent stating that their pension pot is not big enough to fund life after work yet, and 21 per cent feeling unprepared for retirement.

However, almost a quarter (22 per cent) of savers said that they will carry on working because they enjoy the routine, whilst a further 20 per cent simply enjoy their day-to-day job.

There were also prominent concerns amongst older workers, with 37 per cent worried that their health will inhibit their ability to work, and a further 30 per cent worried that continuing to work will make their health deteriorate.

Commenting on the findings, Canada Life strategic propositions director, group insurance, Paul Avis, said: “For some older workers, the events of 2020 have helped them realise they want to spend more time at home, with their families and learning new skills and hobbies.

“Whereas for others, poor health and vulnerability may - sadly - have accelerated their retirement plans.

“While unemployment continues to rise, job losses may be another contributing factor to this drop in the number of people planning on working beyond retirement age, especially for those receiving or expecting redundancy payments.

“However, the shape of retirement is changing and so are the wants and needs of those approaching the next phase of their lives."

He added: “We are witnessing a huge shift in the retirement time horizon as society changes and adapts to a new norm, and these changes are only accelerating due to the pandemic.”

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