Around 2.5m older workers are planing to delay their retirement due to the cost-of-living crisis, with 1.7m saying they may have to ‘work indefinitely’ because they cannot afford to retire.
The research by Legal & General found that two-thirds of employees aged 55 or over say they cannot afford to reduce their income while living costs remain so high. On average it found that workers in this age group are looking to delay their retirement by three years.
As well as the cost-of-living crisis, employees said their retirement plans had been impacted by a range of other external factors, including Brexit and the Covid-19 pandemic.
The research found that one-in-seven of these pre-retirees (16 per cent) are also currently looking for additional work in order to boost their income, and one in 10 are concerned about the stability of their job in light of the current economic conditions.
However, while a need for income remains a priority for those delaying their retirement, a desire to stay in the workplace is also a factor in some cases. The research found that a quarter said they were delaying retirement plans because they enjoyed their jobs (26 per cent); while a further one in four (25 per cent) said they don’t feel ‘old’ enough to retire yet, and a fifth (20 per cent) were concerned they would be bored if they retire.
Legal & General Retail managing director of retail retirement Lorna Shah says: “Retirement can be tricky to navigate even without the backdrop of rising living costs, so it’s understandable that those approaching retirement aren’t sure what they want to do next. While many choose to retire later because they enjoy their work, there are millions of people who’re making this decision based on necessity, rather than personal choice.
“But retirement isn’t a once and done decision. Before concluding their retirement needs to be delayed or forgotten indefinitely, I’d urge people to think about the role different products and assets can play and make use of the free, impartial support available, offered by the likes of PensionWise and MoneyHelper. It’s crucial to have a strong understanding of the options available before making any long-term decisions.”